AUSTRALIA has approved Baosteel Group Corp's bid for a 15-percent stake in its iron ore explorer Aquila Resources Ltd.

The Foreign Investment Review Board gave the green light to Baosteel's proposed A$285.6-million (US$261.5 million) investment with no conditions attached, Aquila said yesterday.

The government also allowed Baosteel to raise the stake up to 19.99 percent, Aquila said.

Aquila yesterday said it anticipates completion of the transaction in the latter half of next month, subject to approval from Chinese authorities.

As part of the deal, Baosteel has agreed to help Aquila obtain low-cost funding from Chinese banks for the miner's projects.

Australia last week approved Yanzhou Coal Mining Co's proposed A$3.5 billion full takeover of Felix Resources Ltd, but with strict conditions.