SWF Radar BHPBilliton

The Observer reports that, “Rio Tinto is looking to establish joint ventures with Chinese government-backed companies, such as Chinalco, according to Tom Albanese, chief executive of the mining giant. Chinalco bought a 9 per cent stake in Rio to try to block an $80bn hostile takeover by rival BHP. The Chinese have become concerned that a combined BHP-Rio operation would control a third of the world’s seaborne iron ore supplies. An alliance between Rio and Chinalco would act as a counterweight.

The Australian writes that, “Chinese investment in Australian resources is like a political chess game, full of subtle moves and counter-moves for a long-term strategic play.”

Thomson Reuters reports that, “BHP Billiton Ltd/Plc Chief Executive Marius Kloppers said it would not be a surprise if a Chinese entity took a stake in BHP, given the country’s need for resources and its big reserves of capital.”

The Sydney Morning Herald reports that, “China’s state-owned steel makers are looking to buy a significant stake in BHP Billiton, despite a warning by the Treasurer, Wayne Swan, yesterday that he would set a high bar for state-owned corporations investing in Australia.”

Thomson Reuters reports that, “The chairman of Baosteel Group, China’s top steelmaker, said on Thursday talk that his company wanted to buy an equity stake in BHP Billiton Ltd/Plc was a ‘market rumor’.”

Thomson Reuters reports that, “Sinosteel Group, China’s largest ferrous metals trader, does not rule out taking a stake in Australian iron ore miner Fortescue Metals Group Ltd, Sinosteel President Huang Tianwen said on Thursday.”

Dow Jones reports that, “Sinosteel Corp. President Huang Tianwen said Thursday the company hasn’t joined a bid for Australian miner BHP Billiton Ltd. (BHP).”

The Australian reports that, “Shares in BHP Billiton jumped 6 per cent to a record yesterday [Wednesday] amid market rumours that a Chinese sovereign wealth fund was angling to grab a $15 billion-plus stake in the mining giant.”

The WSJ Deal Journal writes that, “The surge today in shares of Rio Tinto means the $14.1 billion stake that state-owned Aluminum Corp. of China bought in the United Kingdom mining giant is finally in the black. In a surprise move referred to as ‘the dawn raid,’ Chinalco, as it is known, bought Rio’s London-listed shares in early February for 60 pounds each. The investment, made with help from Alcoa of the U.S., was at a hefty premium to Rio’s then share price of just 50 pounds and seemed to make sense only in the context of China’s interest in influencing the outcome of BHP Billiton’s takeover battle for Rio. (The Chinese steel industry is a big customer of both companies.)”

ChinaStakes.com writes that, “A rumor has erupted in the Australian media that China is planning to buy up a 9% or greater stake in miner BHP Billiton, Ltd., Australia's and the world’s largest diversified resources company. The possible bid is being interpreted as an attempt to interfere in BHP's proposed acquisition of rival Australian mega-miner Rio Tinto, the world's second largest iron ore producer.”

The Australian reports that, “Sources in Beijing said China was in the early stages of planning to snare a bigger chunk of BHP than the 9 per cent stake in rival Rio Tinto it bought with US-based Alcoa for $15 billion in a stock market raid in February. … The plan to buy a stake in BHP is under development, with Chinese authorities yet to determine which state-owned financial institution or steel mill - such as the largest, Baosteel - might take the lead role in seeking sellers within BHP’s diverse shareholder base.”