Law firm acts on $1.1bn major Chinese investment

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An Australian law firm has acted for a Chinese asset company into the investment of PanAust Limited.

King & Wood Mallesons advised Chinese state owned entity, Guandong Rising Assest Management Co., (GRAM) on the bid for ASX listed gold and copper miner PanAust Limited, increasing its shareholding from 23 per cent.

With support from the Guangzhou office, the King & Wood Mallesons was led by partners Andrew Deszcz and Paul Schroder.

“Culmination with our china offices really enabled us to do this deal in the way in which we have done it,” said Deszcz.  “The client preferred as much as possible, to converse in Mandarin so we had the issue of communicating across not only language lines, but also different business culture lines.  That’s a challenge in itself because you need to immerse yourself to some degree with Chinese clients to understand a bit about what they are seeking to achieve in their dealings with Australia.”

In an interesting blend of Chinese and western financing, Deszcz said the deal was partly financed in a way common for Chinese business, but relatively uncommon in Australia. 

“A huge part of the success of this deal was that business culture/ Mandarin piece, it would have been just so much more difficult without it,” he said.

Along with their Laos copper mines, PanAust has recently acquired the Papua New Guinean Frieda River Project which is one of the largest undeveloped copper deposits in the world.

Despite the current doom and gloom in the resources sector, Deszcz is optimistic.

“I think there will certainly be activity in the marketplace for the rest of the year,” he said.

Norton Rose Fullbright also acted on the deal, advising the financers along with Herbert Smith Freehills who acted for PanAust.