Corrs advises Murchison Metals on A$325 million sale of Crosslands and Oakajee Port and Rail interests

24 November 2011

Corrs Chambers Westgarth is advising Murchison Metals Ltd on the A$325 million conditional sale agreement with Mitsubishi Development Pty Ltd in relation to all of Murchison’s interests in Crosslands Resources Ltd and the Oakajee Port and Rail project.

Murchison Metals (Murchison), an Australian ASX listed company, holds a 50% interest in Crosslands Resources Limited, the owner of the Jack Hills iron ore project, and a 50% economic interest in the Oakajee port and rail joint ventures (OPR).  

Crosslands is developing the Jack Hills iron ore expansion project in the mid-west region of Western Australia. The Oakajee port and rail project involves the construction of new port and rail infrastructure to service miners (including Crosslands) in the mid-west region. Mitsubishi Development Pty Ltd, a wholly owned subsidiary of Mitsubishi Corporation, holds the remaining interests in Crosslands and OPR. Together, these projects have a combined estimated capital cost of approximately A$10 billion.

Murchison has been actively engaged in a strategic review process in recent months to maximise shareholder value in relation to the company’s interests in these projects.

The proposed transaction with Mitsubishi provides Murchison with a level of certainty, subject to the satisfaction of the conditions, that it will be able to exit its investment in these projects for a certain cash return.

The deal is subject to a limited number of conditions, including FIRB approval and the approval of Murchison shareholders. Importantly, the Mitsubishi transaction does not preclude Murchison’s ability to pursue any superior proposals that may emerge prior to the time that Murchison’s shareholders vote on the transaction. 

The Corrs team was led by partner Russell Philip, with assistance from  senior associate Louis Martin and lawyer James Nicholls.

Murchison was also advised on the legal aspects of the transaction by Freehills. The financial advisers in relation to the deal are Rothschild and O’Sullivan Partners.

For further information, please email Glenn Taylor or contact by phone on +61 2 9210 6593.