Mining entrepreneur Tony Poli has made around $50 million this morning after China’s biggest steel mill agreed to take a 15% stake in his coal and iron ore miner Aquila Resources.
Chinese steel firm Baosteel will spend $285.9 million for a 15% stake in Aquila. The news has sent shares in the company soaring 11% this morning to $7.30, valuing Poli’s stake at $550 million.
Fellow director Charles Bass holds a stake worth $240 million, meaning he enjoyed a windfall of around $25 million this morning.
The deal will give Baosteel the right to directly invest and co-develop most of Aquila’s projects, while Aquila gets the right to access cheap loans from Chinese banks.
“This is a transforming event for Aquila,” the company said in a statement.
“China’s largest steelmaker has established a strategic cooperation with Aquila, not only to make a major investment in the Company, but also to advance participation in some of the important projects in the company’s portfolio.”
Baosteel vice president Dai Zhihao will join the board as part of the deal.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
