Some of the terms of the FLX seem very familiar. SYDNEY (AFP) –...

Some of the terms of the FLX seem very familiar.


SYDNEY (AFP) – Australia Friday approved Yanzhou Coal's 3.2 billion US dollar takeover of miner Felix Resources, its biggest by a Chinese firm, in a breakthrough for the Asian giant's scramble for commodities.

Assistant Treasurer Nick Sherry set strict conditions for the deal, which follows months of wrangling, two resubmissions and a series of failed Chinese moves for Australian miners.

Sherry said Yanzhou would operate its Australian mines through a locally headquartered company to be listed on Sydney's stock exchange by the end of 2012, and would market the coal "at arms-length prices".

"The Australian Securities Exchange listing of all of Yanzhou's Australian assets ... is a significant development," he said in a statement.

"It represents the first time a Chinese state-owned enterprise operating in Australia will list on our stock exchange."

Yanzhou will also have to slash its ownership of Felix's four coal mines to 50 percent and cut its stake in the new firm to 70 percent by the time of the listing.

"This investment also means jobs for Australians, especially in regional areas," Sherry said.

"Yanzhou will continue all four of the Felix mining operations, including completing the development of the Moolarben mine -- this will create more jobs for both New South Wales and Queensland."

Australia's Foreign Investment Review Board (FIRB) twice ordered Yanzhou to resubmit the takeover bid after it was approved by Felix in August, following 12 months of negotiations.

The deal seemed in doubt after the FIRB's chief told Chinese businessmen he preferred investments below 50 percent for new ventures and 15 percent for big producers, urging a less opaque and heavy-handed approach to acquisitions.

China Non-Ferrous Metal Mining later dropped its bid for Lynas.

Mining giant Rio Tinto earlier walked away from a massive Chinese cash injection, while Wuhan Iron and Steel's bid to gain access to a mining project was rejected on security grounds.