SYDNEY (Reuters) - Hancock Prospecting (Pty) Ltd, controlled by Australian billionaire iron ore magnate Gina Rinehart, on Tuesday said it was investing $300 million (245.30 million pounds) in British fertiliser business Sirius Minerals Plc (L:SXX) as it moves deeper into agriculture.
Hancock said Sirius could become one of the world’s leading producers of multi-nutrient fertiliser.
The company, which has a market capitalisation of 792 million pounds according to Reuters data, is developing a polyhalite project in North Yorkshire in the United Kingdom.
"This fits with my approach of investing in strategic areas for the long term, and I hope the product is of assistance to many Australian farmers," Rinehart said in a statement.
Sirius Chief Executive Chris Fraser said Hancock's investment would bring mining and agricultural sector expertise to the operation.
Polyhalite is a naturally occurring mineral containing four of the six nutrients that ensure plant growth – potassium, sulphur, magnesium and calcium.
In a note Shore Capital, which rates Sirius a buy, said the polyhalite price could be a significant source of upside as yields being demonstrated in crop trials suggest it could command a premium.
It called Rinehart's backing "a resounding endorsement" and said it expected the conclusion of stage one financing this year. A further $800 million will need to be raised.
Sirius' share price was up 3.6 percent by 1133 GMT.
Hancock is also in a joint $278 million bid with China's Shanghai CRED Real Estate for Australia's biggest cattle empire, S. Kidman & Co.
Rinehart is attempting to persuade the Kidman cattle empire that her offer remains superior after a group of four wealthy graziers, known as BBHO, made a A$386 million (240.97 million pounds) bid.
