China's state-backed Sinosteel Corp (中國中鋼) yesterday launched a A$1.2 billion (US$1.1 billion) takeover bid for iron ore miner Midwest in the first hostile approach by a Chinese company for an Australian firm.
Sinosteel, China's No. 2 iron ore importer, said it is offering A$5.60 for each Midwest Corp Ltd share -- 35 percent more than Midwest's closing price on Thursday.
Midwest shares surged more than 30 percent yesterday to as high as A$5.48 before closing at A$5.43.
"It's time Midwest shareholders had the opportunity to decide for themselves the value of their investment in Midwest," Sinosteel president Tianwen Huang (
The bid underscores China's eagerness to gain a foothold in Australia's booming resource sector as demand and prices for raw materials surge, and reflects Beijing's worldwide efforts to ensure that China gets the resources it needs to continue its runaway economic expansion.
China overtook Japan last year to become Australia's largest trading partner, and its voracious appetite for coal, gas and other resources has fueled Australia's unprecedented 17 successive years of growth.
News of the bid came as Australia's central bank chief said that China is a key part of a fundamental shift in the structure of the global economy, and that its influence was not likely to abate anytime soon.
"All the indications are that the rise of China is not just a cyclical event, but a structural change of the first order," Reserve Bank of Australia Governor Glenn Stevens said in a speech published yesterday on its Web site.
While China's growth rate in recent years of around 11 percent would slow "at some point," the country's economy still had years of strong expansion, he said.
Sinosteel already holds a 19.9 percent interest in Midwest, which is planning a project that would produce 15 million tonnes of iron ore a year in Western Australia state to shore up its iron ore supply.
The government's Foreign Investment Review Board has already approved the offer, Sinosteel said.
Australian Prime Minister Kevin Rudd, a former diplomat and China specialist, did not comment yesterday on the bid, but has said previously his government would block any foreign takeover that is not in Australia's national interest.
Midwest advised its shareholders to take no action until the company has had time to consider the bid, and reminded shareholders it rejected as too low an informal bid from Sinosteel in December at the same share price.
Several Chinese steelmakers have formed joint ventures or bought into other Australian iron ore projects in moves interpreted as attempts to provide China with alternatives to resource giants Rio Tinto and BHP Billiton.
BHP Billiton has launched a US$147 billion bid for Rio Tinto that has concerned Chinese steelmakers who worry that, if the deal goes ahead, the resulting mining behemoth could have too much control over prices.
Sinosteel signed a joint venture with Rio Tinto subsidiary Hamersley Iron in Western Australia in the 1980s, giving it "the track record, financial strength and technical expertise to develop and operate large scale mining projects," Huang said.
DEMOGRAPHICS: Robotics is the most promising answer to looming labor woes, the long-term care system and national contingency response, an official said Taiwan is to launch a five-year plan to boost the robotics industry in a bid to address labor shortages stemming from a declining and aging population, the Executive Yuan said yesterday. The government approved the initiative, dubbed the Smart Robotics Industry Promotion Plan, via executive order, senior officials told a post-Cabinet meeting news conference in Taipei. Taiwan’s population decline would strain the economy and the nation’s ability to care for vulnerable and elderly people, said Peter Hong (洪樂文), who heads the National Science and Technology Council’s (NSTC) Department of Engineering and Technologies. Projections show that the proportion of Taiwanese 65 or older would
Nvidia Corp yesterday unveiled its new high-speed interconnect technology, NVLink Fusion, with Taiwanese application-specific IC (ASIC) designers Alchip Technologies Ltd (世芯) and MediaTek Inc (聯發科) among the first to adopt the technology to help build semi-custom artificial intelligence (AI) infrastructure for hyperscalers. Nvidia has opened its technology to outside users, as hyperscalers and cloud service providers are building their own cost-effective AI chips, or accelerators, used in AI servers by leveraging ASIC firms’ designing capabilities to reduce their dependence on Nvidia. Previously, NVLink technology was only available for Nvidia’s own AI platform. “NVLink Fusion opens Nvidia’s AI platform and rich ecosystem for
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it is building nine new advanced wafer manufacturing and packaging factories this year, accelerating its expansion amid strong demand for high-performance computing (HPC) and artificial intelligence (AI) applications. The chipmaker built on average five factories per year from 2021 to last year and three from 2017 to 2020, TSMC vice president of advanced technology and mask engineering T.S. Chang (張宗生) said at the company’s annual technology symposium in Hsinchu City. “We are quickening our pace even faster in 2025. We plan to build nine new factories, including eight wafer fabrication plants and one advanced
‘WORLD’S LOSS’: Taiwan’s exclusion robs the world of the benefits it could get from one of the foremost practitioners of disease prevention and public health, Minister Chiu said Taiwan should be allowed to join the World Health Assembly (WHA) as an irreplaceable contributor to global health and disease prevention efforts, Minister of Foreign Affairs Lin Chia-lung (林佳龍) said yesterday. He made the comment at a news conference in Taipei, hours before a Taiwanese delegation was to depart for Geneva, Switzerland, seeking to meet with foreign representatives for a bilateral meeting on the sidelines of the WHA, the WHO’s annual decisionmaking meeting, which would be held from Monday next week to May 27. As of yesterday, Taiwan had yet to receive an invitation. Taiwan has much to offer to the international community’s