China Mining United Fund plans a second fund to buy “significant” minority stakes in gold, iron-ore and metal companies in Africa and elsewhere, said Alistair Ruiters, an advisor to the fund.
“The first fund started at $1 billion and closed at about $2 billion,” Ruiters, who is also executive chairman of Ruukki Group Oyj’s South African unit, said in a speech in Johannesburg today. “I can only surmise the second fund will follow that particular structure.” One of Ruukki’s biggest shareholders is Kermas Group, China Mining United Fund’s partner in Africa.
China is the world’s biggest metals consumer. Chinese funding could help mining companies finance projects in Africa, which holds large reserves of platinum, copper and chrome.
CMUF is targeting stakes in companies that are close to starting production in deals from $20 million to $100 million, Ruiters said. The fund is also looking for transactions in Australia, Asia and Europe, he said.
CMUF, formed in 2009, is one of China’s first private equity funds to receive approval from the National Development and Reform Commission to make investments abroad, Ruiters said.