Chinese investor tied to Rio sale

A Chinese billionaire rumoured to have Communist Party ties is reportedly behind the $US820 million ($A886 million) purchase of Rio Tinto Ltd's 80% stake in the Northparkes copper and gold mine, according to The Australian Financial Review.

Rio announced on Monday that it would sell its stake to China Molybdenum Co Ltd, whose main shareholders are private equity investor Yu Yong and a local government in the central province of Henan.

The deal marks the first move by China Molybdenum outside the Chinese mainland.

Mr Yu holds a 34% stake in the company through Cathay Fortune, which had earlier failed in a bid for Discovery Metals. Cathay Fortune is believed to be intent on expanding deeper into Australian assets.

Mr Yu was ranked a China's 208th richest person by Forbes magazine last year, the AFRadded.

The Foreign Investment Review Board (FIRB) is believed to have approved the deal, though it remains subject to approval by Rio's joint venture partners, Sumitomo Metal Mining and Sumitomo Corporation Mineral Resources.