What are your thoughts here?
From the DOW JONES NEWSWIRE:
That would coincide with the timing of a decision by Treasurer Wayne Swan on whether to approve or knock back the biggest, and most controversial, foreign investment proposal to date - a planned US$19.5 billion tie-up between Aluminum Corp. of China Ltd., or Chinalco, and Anglo-Australian mining giant Rio Tinto PLC. (RTP).
Australia's Foreign Investment Review Board on Monday extended by 90 days its review of the proposed Chinalco-Rio Tinto deal. It is now due to hand down its recommendation to the treasurer around June 14. Under Australian foreign investment regulations, Swan has the final say on the deal.
Australia has seen interest from Chinese government-backed entities in its mining sector reach a fever pitch in recent weeks, as China tries to secure supplies of key industrial commodities.
It is also currently considering the approval of a A$2.6 billion takeover offer for OZ Minerals Ltd. (OZL.AU) by China Minmetals Corp., and plans by China's Hunan Valin Iron and Steel Group Ltd. to take a 17.4% stake in Fortescue Metals Group Ltd. (FMG.AU).
So while they debate and decide on the direction of Australias future, the shareholders of these companies are sitting on a bomb.
Either the bomb will blow them to great heights or potentially blow them up completely in some instances.
I think it unfair to shareholders that they have to wait 90 days to get some idea on the direction of this policy. Did the Gov not consider prior to now?
Are they seriously considering not allowing any foreign investors getting a slice of our precious resourses? Or are they going to allow up to 25% foreign ownership like they did with the airlines.
Surely, restricting foreign ownership is akin to having tarifs in place, or at least having the same effect. Are we not all about free trade?
Why wouldn't a company like China Minmetals Corp open up an entity called "Dinky Die Minerals" and chip away at a potential hostile takeover anyway?
A lot of questions I know, but companies like RIO, FMG, OZL, etc... are sort of stymied until a decission is made.
Does anybody know what Canadas policy is, and could we head down similar lines since we have similar resource wealth in the ground?
PS: I don't hold any of these stock, would like to, but why would you punt on a decision by Wayne Swan in 3 months? I also would prefer to keep the profits from Australian resources to be fed back into the Australian economy.