Sinosteel Corp has acquired a controlling stake in Zimasco Holdings, Zimbabwe's largest producer of chrome, as it leads efforts to secure overseas reserves of the key ingredient in stainless steel.
Under the deal, Sinosteel will buy 92 per cent of the firm's parent, Zimasco Consolidated Enterprises (ZCE), for about US$100 million.
State-owned Sinosteel, the mainland's second-largest iron ore trader, is among scores of mainland mining companies seeking to secure overseas mineral reserves to feed surging economic growth at home.
The mainland has few reserves of chrome and relies heavily on imports. Sinosteel's reserves, contained in three overseas chrome projects, are equivalent to more than 10 times mainland stocks.
Mainland companies are increasingly focusing on resource-rich Africa, including politically troubled countries such as Zimbabwe, which has the world's highest inflation rate at almost 8,000 per cent, rising unemployment and shortages of foreign currency, fuel and food.
The acquisition of ZCE, Sinosteel's third overseas chrome project, brought the Beijing-based company's chrome ore reserves to about 150 million tonnes, said Jiang Baocai, a general manager of Sinosteel's international co-operation department.
Sinosteel would own 73 per cent of Zimasco indirectly through ZCE, with the remainder in the hands of local institutions appointed by the African nation, Mr Jiang said.