China’s steel major Baosteel will take a 15% stake in Aquila in a strategic cooperation agreement to fast-track the development of Aquila’s key steel raw materials projects.

Under a share placement agreement, Baoseel will purchase 43.95 million Aquila shares at $6.50 a share amounting to A$285.6m, to gain up to a 15% stake in Aquila.

Aquila said the agreement was an important step in executing Aquila’s vision to become one of Australia’s leading globally diversified steel raw materials producers.

Baosteel will work with Aquila to source low cost financing from Chinese financial institutions for most of its major projects including the strategic West Pilbara iron ore project, Aquila said.

The companies will also work towards establishing long-term raw material off-take arrangements from the projects once they begin production.