China based Jiangsu Shagang Group will fully purchase to be issued shares of Grange Resources an Australian iron ore producer for AUD 167 Australian.

To do so, Shagang Group, the largest shareholder of Grange will ensure its 47.1% stake not to be diluted. It also increased interests in Grange fit well with the trend these days of Chinese firms' investment in overseas mineral industries.

Previously on Monday, an agreement between China Iron and Steel Association and Australian miner Fortescue Metals Group had been reached concerning iron ore in 2009. Besides, Fortescue announced that it would receive USD 5.5 billion to USD 6 billion in financial support from a Chinese institution before September 30th.

An industrial insider said with ever increasing agreements being made between international companies and small and medium sized Chinese steel plants, Chinese producers are now able to exploit new space for negotiations with Australia's small and medium sized mines.

Mr Li Xinchuang an official with China Metallurgical Industrial Planning and Research Institute said that China supports domestic steel-related enterprises to acquire and create overseas mines, and also assist small and medium sized foreign mines in expanding their production capacities.

(Sourced from tradingmarkets.com)