The Shougang Group's takeover of Australia Gibson Iron Ltd has encountered temporary resistance, the Oriental Morning Post, a Shanghai-based newspaper, learned yesterday.
Reports indicate that the Shougang Group's attempted transaction for 19.73% stake of Australia Mount Gibson Iron Ltd has been suspended by the Australian Securities & Investments Commission (ASIC) as of last Friday.
ASIC made the announcement on its official website on February 29, stating that, under the relevant provisions of the "Australian Company Law," the Commission had determined that the equity transaction between the Shougang Concord International Enterprises Co. Ltd. (0697.HK, SHOUGANG INT'L, a listed company affiliated to the Shougang Group) and the Gazmetall Holding was to be suspended within the next two months following the publication of the announcement.
It's said that the transaction was suspended for an alleged breach in the "Australia Company Law."
Gibson Iron issued a statement, saying that it would start researching the status of the Shougang Group. The reason is that Shougang had taken stock of the Gibson Iron via APAC Resources Ltd (1104. HK), another listed Hong Kong company. APAC Resources owns 20.22% of the shares in Gibson Iron, while Shougang Holding (Hong Kong) Ltd. currently has a 16.09% stake in APAC Resources - the third largest shareholder.
According to the "Australia Company Law," an investor must fulfill all obligations or apply for an exemption when he offers to buy more than 20% of the shares listed by a company. Once the SHOUGANG INT'L and APAC Resources are proved to be connected, the Shougang Group would possibly control nearly 40% of the Gibson Iron shares, well above the 20 percent criterion.
For more details, please read the full story in Chinese (http://www.dfdaily.com/node2/node27/node120/userobject1ai60099.shtml).
(China.org.cn March 6, 2008)