China Eximbank provides a $140 million USD loan to Hanlong Mining Investment to facilitate its acquisition of a 59.62% ownership stake in Moly Mines Limited

Project narrative

On October 19, 2009, Hanlong Mining Investment Pty Limited — an Australian subsidiary of Chinese private conglomerate Sichuan Hanlong Group Co., Ltd — entered into a subscription agreement with Perth-based Australian mining company Moly Mines Limited in which Hanlong would purchase 207,135,646 shares in Moly Mines at $0.747 AUD per share, a consideration of $140 million USD, and, among other things, arrange debt financing for Moly Mines' Spinifex Ridge Molybdenum / Copper Project. Australia's Foreign Investment Review Board (FIRB) approved the transaction in November 2009. China's Ministry of Commerce (MOFCOM) issued its approval in late January 2010. Then, on March 29, 2010, the Export-Import Bank of China issued a $140 million USD acquisition loan to Hanlong Mining Investment Pty Ltd to facilitate the acquisition. Then, on April 23, 2010, Hanlong completed the acquisition and obtained the 59.62% interest in Moly Mines. At the time of the acquisition, Moly Mines owned the world's second-largest molybdenum deposit in Pilbara, Western Australia. Molybdenum is a metal with strength, heat tolerance, and corrosion resistance that is used in specialized steel alloys for industrial and military purposes; it is viewed as a strategic mineral This acquisition was later the subject of controversy. At the time of the acquisition, Sichuan Hanlong Group's chairman was Chinese billionaire tycoon Liu Han. Liu led the negotiations to acquire the stake in Moly Mines. Moly Mines' executives arranged background checks on Liu upon the launching of the bid; Liu was best known in China as a philanthropist in his native Sichuan, particularly because a school he had helped build withstood during the devastating 2008 Sichuan earthquake, protecting all its students, when most others schools had collapsed and killing their students, and that he also donated extensively to support reconstruction. The background checks did reveal an assassination attempt on Liu in 1997, but the acquisition went forth nonetheless. Later, Hanlong's attempted acquisitions of Sundance Resources and Bannerman Resources involved illegal trades by the executives of Hanlong Mining Investment, including Shanghai-born Australian citizen Calvin Zhu Boshi, who pled guilty for these crimes and was sentenced to 15 months in prison in February 2013; Zhu claimed to have done so out of fear for his safety from retribution from Liu. Zhu's fellow executives reportedly described Liu as a "warlord", a term used in Chinese culture for powerful business moguls with success in business, politics, and the underworld. Then, in March 2013, Chinese authorities arrested Liu. Then, in May 2014, Liu, his younger brother Liu Wei, and three associates were sentenced to death for "leading mafia-style crime and murder"; as the leader of Sichuan-based Hanlong Group, Liu was alleged by Chinee authorities to have used his influence to received improper benefits from the local government, created illegal monopolies, and "tyrannised local people." The Chinese Government executed Liu in February 2015.