Page last updated at 08:21 GMT, Monday, 16 February 2009

Chinese firm to buy Oz Minerals

An Australian mine
Global commodity prices have been falling amid the global downturn

China's Minmetals has agreed to buy Australian miner Oz Minerals for 2.6bn Australian dollars ($1.7bn; 1.2bn).

The board of the debt-laden miner decided that the offer was "in the best interest of Oz Minerals' shareholders".

Last week Oz warned of asset write-downs of about A$2bn because of sharp falls in commodity prices.

The deal comes just days after mining giant Rio Tinto announced that Chinese firm Chinalco was to invest $19.5bn in the business.

The deal could lead to Chinalco increasing its stake in Rio to 18% from the current level of 9%.

Price falls

In a statement, Zhou Zhongshu, chairman of Minmetals, said: "Minmetals intends to continue to operate Oz Minerals' portfolio of assets, and its acquisition will provide the opportunity to support the development of Oz Minerals' assets and projects."

The deal needs to be approved by Australian foreign investment regulators.

Global commodity prices hit record highs last summer before falling back sharply amid the global downturn.

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