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PrintSHANGHAI, Nov 19 (Reuters) - Western Mining Co (601168.SS: Quote, Profile, Research, Stock Buzz) said on Wednesday it plans to purchase a 39 percent stake in Xining Special Steel Group from its parent for 1.1 billion yuan ($161.2 million).
Western Mining, China's fourth-largest zinc smelter and second-largest lead miner, will pay Western Mining Group up to 40 percent of the transaction amount as prepayment, according to a company statement posted at the Shanghai Stock Exchange.
The deal will need the approval of shareholders and the provincial authorities.
Xining Special Steel Group is the controlling shareholder of listed Xining Special Steel Co (600117.SS: Quote, Profile, Research, Stock Buzz) with a 49.87 percent stake, according to the listed firm's first-half earnings report.
Western Mining also plans to issue 4 billion yuan of fixed rate bonds with a term of 10 years, which will require shareholders' authorisation and regulator approval, the company said in the statement.
The funds raised by the bond issuance would be used to develop mining and smelting projects at Yulong copper mine, China's largest copper deposit in Tibet, among other projects.
Western Mining shares on the Shanghai Stock Exchange closed at 6.98 yuan on Wednesday, up 6.2 percent, tracking the Shanghai Composite Index's .SSEC 6.1 percent rally.
A unit of Goldman Sachs (GS.N: Quote, Profile, Research, Stock Buzz) owns just over 8 percent of Western Mining. ($1=6.823 Yuan)
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