China Investment Corp teams to buy Australian port company
Date
3/1/2016 11:09:49 PM
(MENAFN- Asia Times) Asciano port facility in Australia
Yet with Australia growing in importance as a trade partner China is looking at ways to extend the project Down Under. Already Australia is a major supplier of commodities to China. And a free trade deal signed last year should cause exports to increase.
In order to secure global supply chains China Investment Corp (CIC) the country’s $747 billion sovereign wealth fund is joining a consortium offering to pay $6.4 billion for Australia’s Asciano the country’s largest ports and rail operator.
“This is part of a process where China does want to control its logistics chains” Harry Theochari London-based global head of transport at law firm Norton Rose Fulbright told Reuters. “If you are a big emerging nation that’s very heavily reliant on raw materials from other countries … you'd want to have as much control over the transporting of those fundamental raw materials as you possibly can.”
Cargo handler Qube Holdings leads the CIC consortium which is offering $9 billion Australian ($6.4 billion) for Asciano. Under the deal which has been recommended by Asciano’s board CIC would take a stake in both Asciano’s ports and rail operations.
A potential alternative proposal being discussed involves Qube teaming up with rival Canadian bidder Brookfield Asset Management reported Reuters. This proposal would leave CIC owning the railways but not the ports which Australia views as strategic assets that should remain in local hands.
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