China third largest steel group, Wuhan Iron & Steel Co has formally moved to a 13.04% equity stake in South Australia iron ore developer Centrex Metals Limited for AUD million.

40,399,599 ordinary shares in Centrex were placed with WISCO this week at a price of AUD 0.25 per share.

The placement represents the first part of an up to USD 271 million investment by WISCO in Centrex after the Australian Foreign Investment Review Board approved the joint development of a series of iron ore projects and a deep water port on South Australia's Eyre Peninsula.

The placement expands Centrex current total number of ordinary shares on issue from 269.3 million to around 309.7 million.

Under the agreements approved by FIRB, additional to the share placement, WISCO will:

1. Unconditionally pay AUD 78 million directly to Centrex for a 60% stake in the iron ore rights over five of Centrex seventeen mineral tenements.

2. Pay a further AUD 108 million directly to Centrex if/when progressive JORC Inferred iron resource milestones are achieved.

3. In addition, sole fund the first AUD 75 million of iron only exploration and development across the five tenements, working towards the development of two, five million tonne magnetite concentrate operations.

4. Form a separate 50/50 JV for the development of a Cape size capable deep water port at Sheep Hill on the east coast of the Eyre Peninsula.

Mr David Lindh chairman of Centrex said "The placement by WISCO builds upon the strong foundations Centrex has set in place this year, via a series of strategic joint venture investments by our Chinese business partners in our magnetite assets and iron exploration rights.

This, combined with the gaining of key approvals for Centrex own 100% owned hematite project at Wilgerup also on Eyre Peninsula, positions the Company as a future player in the iron ore industry and South Australian economy."