Xstrata gets nod for its WMC bid

AUSTRALIA'S Treasurer, Peter Costello, has given the thumbs-up to London-listed Xstrata's A$8.4bn (£3.4bn) hostile takeover bid for miner WMC Resources.

His decision is a blow for a campaign against the bid, backed by some senior ministers, that was damaging the country's image as a welcoming foreign investment destination.

WMC, the world's fifth-largest nickel producer, is sitting on 38% of all known uranium reserves and has substantial copper assets.

Critics of the deal argue that it is in the national interest for WMC to remain in Australian hands because of the uranium-reserves at its giant Olympic Dam project in southern Australia.

But Costello said: 'I have decided that the Australian government has no objection to Xstrata Plc's proposed acquisition of all the issued shares of WMC Resources Ltd provided the corporation complies with the conditions set out.'

He stipulated that Xstrata must maintain an exploration programme, keep its coal and metals mining headquarters in Australia and consult the government before making third-party marketing arrangements for uranium.