Chinese group cleared on Cape Lambert

China Metallurgical Group Corporation has received no objection from the Foreign Investment Review Board for its proposed acquisition of the Cape Lambert Iron Ore project.

The project, which is currently owned by Leederville based Cape Lambert Iron Ore, is at a feasibility stage and subject to an offer for purchase by MMC.

Previous announcements shows that Cape Lambert is selling its namesake iron ore project to MCC, which is located in the Pilbara region of Western Australia, for $400 million.

Full announcement below:

China Metallurgical Group Corporation has received confirmation of no objection from the Foreign Investment Review Board in respect of its proposed acquisition of the Cape Lambert Iron Ore Project.
The Company, Officers from MCC and their representative legal advisors are currently negotiating the terms of the Sale Agreement.

Cape Lambert Iron Ore Limited ("Cape Lambert" or the "Company") (ASX: CFE, AIM: CLIO) is an Australian iron ore and exploration development company, which owns 100% of the Cape Lambert Iron Ore project (the "Project"), located in the Pilbara region of Western Australia. The Project currently has a 1.56 billion tonne JORC1 compliant magnetite iron ore resource2, which is at feasibility stage and subject to an offer for purchase by MCC.

Further to the Company's announcements dated 29 April 2008 and 21 May 2008 in which it advised the anticipated date for FIRB's decision was on or before 28 May 2008, the Company is pleased to advise that it has now received written confirmation from MCC's Australian legal advisor that FIRB has no objection (on an unconditional basis) to MCC's application in respect of its proposed acquisition of the Project.

The Company also advises that negotiations in respect of the Sale Agreement are progressing with officials from both the Company and MCC currently working together to seek to finalise the terms of the agreement.

A notice of meeting is currently being prepared, for the purpose of obtaining Cape Lambert shareholder approval of the sale, and will be provided to shareholders in the coming weeks, subject to the successful conclusion of negotiations on the Sale Agreement.