Shougang bid on ore producer foiled

Shougang Corp's plan to buy a 19.7 percent stake in Australian iron ore producer Mt Gibson Iron Ltd from Russian billionaire Alisher Usmanov was blocked by a regulator because of Shougang's links to an existing holder.

Shougang Concord International Enterprises Co, a unit of China's ninth largest steelmaker, is associated with existing Mt Gibson shareholder APAC Resources Ltd, the Melbourne-based Takeovers Panel said yesterday in a statement.

The rejection, supported by Mt Gibson, foils Shougang's attempt to increase control of iron ore supply as prices for steel raw material soar. Chinese mills agreed last month to pay at least 65 percent more for ore this year.