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Yilgarn gains Chinese funding to finance port project

Yilgarn gains Chinese funding to finance port project

Shanghai: Australia-based Yilgarn Infrastructure Limited has signed an investment agreement in Beijing last week with five major Chinese companies to sell them a 50% stake to underpin the A$750m ($602m) equity needed for the development of the Oakajee Port and Rail Project in Western Australia's Mid West region.

Speaking  at  the  ceremony,  Yilgarn  Chairman  Dr  John  Saunders  said  a  crucial  component of the agreement was a 'local content' commitment by all parties to partner  with Australian expertise and suppliers for the development, construction and operation  of the estimated A$3 billion infrastructure project.

The group of five companies - China Railway Materials Commercial Corporation (CRM), Sinosteel, China Railway Engineering Corporation, China Communications Construction Company and Angang Steel, have combined assets of more than $50bn and revenues of more than $60bn.

The equity deal follows a commitment by China's EXIM Bank to underwrite the debt required for the project.

"Yilgarn is forging a highly skilled and competent project team by combining Australian expertise and local inputs with Chinese project execution capabilities," said Saunders. "This agreement provides significant opportunities for Western Australian companies to form partnerships in key roles for this project and to take advantage of China's demand for our products and the need for local expertise. It also sets up a pathway for companies in WA to go offshore to join their Chinese counterparts in the Chinese project and infrastructure marketplace."

Yilgarn also plans to list on the Australian Stock Exchange to enable further investment in the company from the Australian public and institutions.  [20/08/07]