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Proposal by Mitsubishi development Pty. Ltd. to acquire a further 10 percent of the issued capital of white industries limited



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T1EASUREH

EMBARGO 5.00 pm 21/3/80

STATEMENT BY THE TREASURER, THE HONOURABLE JOHN HOWARD M.P.

PROPOSAL BY.MITSUBISHI DEVELOPMENT PTY. LTD. TO ACQUIRE A

FURTHER 10 PER CENT OF THE ISSUED CAPITAL OF WHITE INDUSTRIES

LIMITED .

After consideration of a proposal by Mitsubishi Development

Pty. Ltd. to increase its equity in White Industries Limited

from 14.9 per, cent to a maximum of 25 per cent, I have decided to raise no objections under the Foreign Takeovers Act.

Mitsubishi Development Pty.Ltd. is a joint venture partner to

the extent of 40 per cent with White Industries Limited in the

Ulan coal mine in New South Wales. The mine is to he greatly expanded to operate at a capacity of 4 million tonnes of steaming

coal per annum, largely for export to foreign markets.

In order to bring the expanded mine into production, it will

be necessary to construct a new rail link of 105 kilometres

between Ulan and Sandy Hollow and to upgrade the line from

Sandy Hollow to Muswellbrook. These projects will require *

the arrangement by the joint venturers of substantial capital funds and will lead to significant benefits to Australia and

in particular to New South Wales. . . '

Some weeks ago there was heavy trading in the shares of White

Industries leading to suggestions that competing interests were

seeking to acquire a substantial or controlling position in that,

company. Mitsubishi had achieved an interest of 14.9 per cent

which _i.s -the maximum .it -..could obtain without ..approval of the Government under the Foreign Takeovers Act.

Mitsubishi requested approval to increase its interest up

..to a maximum of 25 per cent so that it could attempt to preserve the existing control of White Industries Limited

and the partnership arrangements that exist between the

two companies.

The Government's decision was reached.after careful examination by the Foreign Investment Review Board, in

terms of the criteria laid down by the Government for

examination of proposals falling within the scope of the

Foreign Takeovers Act. I am satisfied that the proposal

would not be contrary to the national interest. The

decision reflects the Government's policy of dealing

fairly with foreign firms which undertake investment in the

development of Australia's natural resources. , .. . .

This decision is not intended to indicate that the Government favours any particular party. It will have the effect of

permitting market forces to determine where the control of White Industries Limited will/ reside.

CANBERRA

21 March 1980