Corporates: OZ Minerals; Crane; Prime Media

  OZ Minerals shares will remain in a trading halt as it talks to its would-be Chinese suitor, Minmetals, whose offer was ruled out by the Federal Government on Friday.OZ Minerals wants an extension to refinance & #36;1.3 billion of debt due tomorrow.The rejection of the life-saving Minmetals' & #36;2.6 billion bid was not expected.The offer was to have saved the company from almost certain collapse, now the two parties are trying to restructure it to meet government objections to the offer: the presence of a Chinese company controlling OZ's & #36;1 billion Prominent Hill mine which is 150 kilometres from the Woomera weapons testing area in northern South Australia.Federal Treasurer, Wayne Swan revealed the ruling late Friday in a statement; & quot;An important part of this assessment is whether proposals conform with Australia's national security interests, in line with the principles that apply to foreign government related investments. & quot;OZ Minerals' Prominent Hill mining operations are situated in the Woomera Prohibited Area in South Australia. & quot;The Woomera Prohibited Area weapons testing range makes a unique and sensitive contribution to Australia's national defence. & quot;It is not unusual for governments to restrict access to sensitive areas on national security grounds. & quot;The Government has determined that Minmetals' proposal for OZ Minerals cannot be approved if it includes Prominent Hill. & quot;I have informed Minmetals of this decision. Discussions between the Foreign Investment Review Board and Minmetals are continuing in relation to OZ Minerals' other businesses and assets, and the Government is willing to consider alternative proposals relating to those other assets and businesses, & quot; the statement read.The Foreign Investment Review Board only extended its review of the Minmetals takeover bid by 90 days a week ago: Friday's rejection came out of the blue.OZ Minerals shares last traded at 55.5c; if they were to trade today, they would suffer a very sharp drop.For that reason trading will remain suspended until the question of the future of the bid and the finance can be sorted out.If it can't, the company is likely to seek appointment of administrators to protect its position.Investors immediately saw a message in the rejection for the bid by Chinese government-controlled Chinalco to take a major stake in Rio Tinto in exchange for & #36;US19.5 billion in new equity.Chinalco has completed arranging a & #36;US21 billion loan to finance its planned tie-up with Rio.China's top aluminum company raised the loan from a consortium of banks led by the China Development Bank.(All are controlled by the Chinese government, so the money would have come anyway. Failure to fund the loan request would have meant the government opposed the deal).The loan arrangement includes a & #36;US19.5 billion loan for the transaction and a & #36;US1.5 billion standby facility to finance ongoing working capital and other expenditures linked to the deal. & quot;The commercial terms we have obtained reflect the banks' confidence in the excellent potential of our partnership with Rio Tinto and in the long-term prospect of the mining industry, & quot; Chinalco President Xiong Weiping said in a statement. & quot;The proposed strategic investment in the Rio Tinto Group will allow Chinalco to advance its strategic goal of global diversification. & quot;Under the deal, Chinalco would pay & #36;US12.3 billion for stakes in Rio's iron ore, copper and aluminum assets and & #36;US7.2 billion for convertible bonds that would double its equity interest in Rio Tinto to 18%.The agreement with Rio required Chinalco to secured funding by the end of March.The deal continues to spark opposition by some major shareholders and politicians worried about what they regard as favourable treatment of one shareholder and too much influence in Australia by a Chinese state entity.But Federal Finance Minister, Lindsay Tanner says the rejection of the bid for OZ Minerals will not affect the Government's consideration of the proposed Chinalco deal.Mr Tanner said yesterday the Federal government could approve a Chinese takeover of OZ Minerals if the terms were changed. & quot;It's not clear what the outcome will be, and there is the possibility a revised deal will be worked out and put to the government at some point, & quot; Mr Tanner told Sky News.The minister said the treasurer's decision on the Minmetals-OZ Minerals deal would not necessarily affect a bid by Chinese aluminium maker Chinalco, another state-owned corporation, to buy a & #36;27.69 billion stake in Rio Tinto. & quot;Not at all. You really need to look at these things on a case-by-case basis, & quot; Mr Tanner said. & quot;To be honest, I don't know whether any of the Chinalco bid circumstances involve defence weapons testing ranges, but I suspect they don't. & quot;So this shouldn't be seen as some kind of (pre-determination) or the scene setter for a decision on the Rio-Chinalco proposition, & quot; he told Sky.  

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