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Print* Fortescue denies in talks with China Investment Corp
* Says sees no need for capital or equity injections
SYDNEY (Reuters) - Australian miner Fortescue Metals Group Ltd , which relies solely on sales of iron ore to China's steel sector, on Monday denied a report it was in talks to sell a stake in the company to a Chinese sovereign wealth fund.
The South China Morning Post reported that China Investment Corp was in discussions to buy a minority interest in Australia's third-largest iron ore miner.
"There is nothing to it, the story's quite wrong," Fortescue spokesman Paul Downie told Reuters.
"The company also does not need any new capital or any new equity," Downie said.
The newspaper report also said CIC may bring in strategic investors such as China's largest iron and steel maker, Baosteel Group, and the country's biggest coal miner, China Shenhua Energy , if the talks progress with Fortescue founder Andrew Forrest.
Forrest, briefly crowned Australia's richest individual after Fortescue's stock soared earlier this year, owns 35.82 percent of the company.
Fortescue on Monday traded as low as low as A$1.825 from as high as A$13.15 on June 29.
Last week, Forrest said demand for the company's ore remained strong and its relationships with customers were robust amid a downturn in China.
Tapering demand in China and elsewhere as steel mills feel the effects of the global financial crisis have left miners worldwide attempting to gauge next year's outlook.
In the past two years, China, which makes more steel than any other country, has rushed to provide seed capital and sign supply agreements with a army of outback start-ups to ensure a steady stream of richer Australian ore to its mills than it can provide from its own mines.
Now facing an over supplied market, Fortescue has shaved 2 million tonnes off its December 31 production target of 22 million tonnes, following bigger cuts made by Vale of Brazil, 30 million tonnes, and Rio Tinto , 20 million tonnes.
ArcelorMittal the world's biggest steel company is reducing its production alone by 37 percent as demand for its steel falls.
In China, which makes more steel than any other country and holds considerable sway over price benchmarking, crude steel production will drop 15 percent to 420 million tonnes in 2009, according to UBS.
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