Sydney - Australian copper and gold producer OZ Minerals Ltd on Monday recommended to shareholders a cash offer from China Minmetals Non-ferrous Metals Company Ltd that values the debt-laden company at 2.6 billion Australian dollars (1.6 billion US dollars).

The takeover bid follows Anglo-Australian miner Rio Tinto Ltd's proposed selling of assets worth 19.5 billion US dollars to existing shareholder Aluminum Corp of China (Chinalco), another Chinese state-backed company.

The deals require the approval of Treasurer Wayne Swan, who late last year stated his concern that Chinese companies, who were also top customers for Australian commodities, were seeking control of Australian mining companies at a time when they were struggling to adjust to lower prices for their minerals.

"While Australia welcomes foreign investment in our economy, we will carefully examine national interest issues where these arise in relation to foreign sovereign ownership," Swan said.

The proposed deal would see Minmetals taking over OZ Minerals and then paying off its debts of around 1 billion Australian dollars.

"The board has determined that Minmetals' cash proposal is in the best interests of OZ Minerals' shareholders and believes this is the best outcome for shareholders compared with any of the other options available to us," chairman Barry Cusack said in a statement.

Shares in OZ Minerals have been suspended from trading on the stock exchange since December. (dpa)