Fortescue Metals Group (ASX: FMG) has formed a joint venture with Taiwan's largest private company Formosa Plastics Group where it will invest $1.15 billion in the FMG Iron Bridge Project in the Pilbara.
Formosa will gain a 31 per cent stake in the FMG Iron Bridge joint venture for $US123 million.
FMG Iron Bridge Ltd is jointly owned by Fortescue (88%) and a subsidiary of China’s Shanghai Baosteel Group Corporation (12%).
Formosa will also provide the first $US527 million of capital spending on the project.
The deal is subject to Australian Foreign Investment Review Board and Taiwan Investment Commission approval, which is expected in September 2013.
Construction of Stage One is expected to take 12 months, with first production of 1.5 million tonnes per annum of 66% iron hematite product commencing in early 2015.
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