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Proposal by Conzinc Riotinto of Australia Ltd inconsistent with Government's foreign investment policy



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NO. 123

z .

TREASURER

STATEiENT BY THE IEPUTY PRIMS MINISTER AND THE TREASURER

T he D eputy P rim e M in is te r and" t h e T r e a s u r e r announced to d a y t h a t

th e . G overnm ent had d e c id e d t h a t th e p ro p o s a l by Con z in c R i o t i n t o

o f A u s t r a l i a L td (CRA) to a c q u i r e up to 50% of th e is s u e d

c a p i t a l of C oal and A l l i e d I n d u s t r i e s L td . (CAIL) , as p a r t o f a

j o i n t - t a k e o v e r * b id by "CRA and Howard S m ith^L td , to . a c q u i r e ; a l l

o f th e is s u e d c a p i t a l of CAIL, w ould n o t be i n c o n s i s t e n t w ith .' . :i

t h e G o v e rn m e n t's f o r e i g n in v e s tment- p o lic y . ·..<

The M in is te r s s a i d t h a t t h i s d e c i s i o n had been re a c h e d a f t e r ,

c a r e f u l and d e t a i l e d e x a m in a tio n of th e p ro p o s a l by th e . F o r e ig n .

In v e s tm e n t Review B o a rd . . ■ , . . .

The p ro p o s a l was c o n s id e re d t o be c o n s i s t e n t w ith . th e

G o v ern m en t's o b j e c t i v e of w elcom ing p a r t n e r s h i p s betw een

A u s t r a l i s i and f o r e ig n i n t e r e s t s i n th e developm ent of

A u s t r a l i a 's n a t u r a l r e s o u r c e s . , . .

x1 .

T h is d e c is io n was s u b j e c t t o an u n d e r ta k in g by th e R io

T in to - Z in c C o r p o r a tio n , th e p a r e n t company o f CRA, t o move

p r o g r e s s i v e l y to w ard s m a j o r i t y A u s t r a l i a n o w n e rs h ip o f CRA and

t h a t a rra n g e m e n ts w ould e n s u re e f f e c t i v e A u s t r a l i a n c o n t r o l .

2

The r a t e , o f th e programme w i l l be s u b j e c t t o norm al com m ercial

c o n s id e r a tio n s b u t to e n s u re a c c e p ta b le p ro g re s s th e G overnm ent

h a s a rra n g e d f o r an n u al c o n s u l t a t i o n s betw een RTZ and CRA and

t h e F o r e ig n In v e s tm e n t R eview B oard on t h e im p le m e n ta tio n of th e

programme and th e a rra n g e m e n ts on c o n tro l* . . '

As a f i r s t s t e p to w ard s t h i s o b j e c t i v e CRA had amended i t s o f f e r

to s h a r e h o l d e r s 'i n CAIL to g iv e them th e o p p o r t u n i t y t o ta k e up :

s h a re 's · i n CRA:. . . *

T h is o f f e r w i l l e n a b le m i n o r i t y s h a r e h o ld e r s o f CAIL -to . c o n tin u e ; -

to p a r t i c i p a t e i n d i r e c t l y * i n th e com pany's .o p e r a t i o n s and·, w ill

r e t a i n A u s t r a l i a n o w n e rsh ip i n ’A u s t r a l i a 's n a tu r a l- re s o u rc e s . - * .

Commenting on th e u n d e rta k in g - by RTZ to a c h ie v e m a jo r it y r.. ;

A u s t r a l i a n o w n e rsh ip o f CRA, th e M in is te r s welcomed th e move as. , .

c o n s i s t e n t w ith t h e G o v e rn m e n t's f o r e i g n in v e s tm e n t p o lic y of -

e n c o u ra g in g g r e a t e r A u s t r a l i a n p a r t i c i p a t i o n i n th e developm ent

o f A u s t r a l i a 's r e s o u r c e s . _

" ' ‘ . - . ■ . ^ ■ t . . ; . * ■

The M in is te r s n o te d t h a t th e commitment t o a c h ie v e -, m a j o r i t y .

A u s t r a l i a n o w n ersh ip o f CRA w ould r e s u l t i n an im p o rta n t s t e p ·. -

tow ards g r e a t e r A u s t r a l i a n o w n e rsh ip and c o n t r o l of the m in in g

i n d u s t r y . . -

14 October 1977

Canberra act