successful in china your partner to ‘go out’. well established australian mining company. listed...
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Successful In China
Your Partner To ‘Go Out’
• Well established Australian mining Company.
• Listed in Australia (ASX) and London (AIM).
• Been on the ground in China since 2003 when mining sector opened to foreign investment.
Profile
• Established first Sino Foreign Gold mine in Heilongjiang.
• Invested in early stage exploration project and developed it into one of the largest gold mines in the province.
• Extremely successful and profitable co-operation between Sino and Foreign parties.
Successful In China
• In 2005 Leyshon hosted Australian delegation to MOLAR Vice Minister Wang Min.
• His advice was to ‘Go West’ where foreign investment is welcome.
• Leyshon now looking at investing in early stage coal project in Xinjiang.
• Bringing risk capital and the latest mining, processing and environmental technology.
Current Investment
• US$ 47 billion of rail and other infrastructure being invested to develop world class thermal coal resources.
• Autonomous region will become a major energy provider for the rest of China through ‘Coal by Rail’ and ‘Coal by Wire’.
• Xinjiang is larger by area than Mongolia - has larger (higher energy) thermal coal resources and has the advantage of major infrastructure under development including dedicated coal transport lines.
Xinjiang
Xinjiang
Inward v Outward M&A Deals
Austra
lia
Brazil
Canad
a
China
Chile
Indones
iaPer
u
Russia
South A
frica UK
USA0%
20%
40%
60%
80%
100%
OutwardInward
Source: Citi Investment Research and Analysis
M&
A D
eals
by
valu
e
Global Mining EV by Region – 2004
5 10 15 20 25 300
5000
10000
15000
20000Bubble Size=$50bn EV
UK
USA
Source: Bloomberg and Citi Investment Research and Analysis
EB
ITD
A (
US
$m)
Canada
Australia
South Africa China
Global Mining EV by Region – 2010
5 10 15 20 25 30 35 400
10000
20000
30000
40000
50000
60000
70000
Bubble Size=$50bn EV
UK
USA
Source: Bloomberg and Citi Investment Research and Analysis
EB
ITD
A (
US
$m)
Canada
Australia
South Africa
China
• Targeting mainly coal and iron ore but also a host of other minerals and energy.
• Types of investment and
• the range of Chinese investor companies will rapidly diversify.
Australia - A Favored Destination
Net M&A Flow by Region (US$bn)
Austra
lia
Brazil
Canad
a
China
Chile
Indones
iaPer
u
Russia
South A
frica UK
USA-80
-60
-40
-20
0
20
40
Net
de
al f
low
dire
ctio
n
Source: Bloomberg and Citi Investment Research and Analysis
Out
war
dIn
war
d
• Australia's FIRB regulations increasingly restrictive - but not a barrier.
• China's MOFCOM/NDRC regulations equally restrictive - but yet to be tested.
FIRB v MOFCOM
Deals by Commodity Type (2001-Present)
GoldCoal
Copper
Iron O
re
Nicke
l
Alum
iniu
m
Lead &
Zin
c
Uraniu
m
Potash
Other
020406080
100120140160180200
Source: Bloomberg and Citi Investment Research and Analysis
Cum
ula
tive
de
al s
ize
(US
$bn)
The key to successful investment into Australia is the same as for that into China:
Co-operation with a good partner.
"We are with you. You are with us.”
Co-Operation
• Co -Invest in China with a strong partner.
• Co-Invest in Australia with a strong partner.
• We have partners in China.
• We are looking for partners to join us in investing
in Australia.
Strategy
• Projects in Australia looking for Investment.
• Strong technical capability.
• Access to London, Australia and Hong Kong
Capital Markets.
Strengths
Thank you!
Please Contact:
Peter Niu -- Chief Financial Officer [email protected] 139-1169-7586
Lily Cong – Business Development Manager [email protected] 135-2111-3831