Australian copper producer Discovery Metals Ltd., which has mines in Botswana, is being eyed for acquisition by Chinese private equity firm Cathay Fortune Corp. for A$830 million ($848 million).

The Chinese firm, which currently controls 13.7 per cent of the ordinary shares of Discovery Metals, offered A$1.70 a share in cash for the remaining stock that it does not own yet in Discovery. The bid, which is 17 per cent higher than Discovery's closing price on Oct. 3, would mean that Cathay Fortune would take up 75 per cent of the copper producer, while the China-Africa Development Fund the remaining 25 per cent.

"The offer seems fully priced - the market has decided that commodities are coming off as China's growth slows, so asset values are falling," analyst Chris Brown told Bloomberg News. "Unlike zinc, where the Chinese are a major producer, they're not major producers in their own right in copper."

China Development Bank will fund the bid of Cathay Fortune through a term loan facility of up to $600 million.

Australia's Foreign Investment Review Board has also approved Cathay Fortune's takeover bid.

A Shanghai-based private equity firm, Cathay Fortune manages a portfolio valued more than $3 billion. It is the owner of China Molybdenum, the fourth largest molybdenum producer in the world, with controlling stakes placed at 35 per cent.

Discovery Metals is listed both at the Australian Stock Exchange and Botswana Stock Exchange as a copper exploration and production company. It is focused on the promising Kalahari Copperbelt in north-west Botswana. It is also a copper producer with full ownership of the Boseto Copper Project.

Discovery Metals' copper-silver mine in western Botswana gave its first copper in July at 36,000 metric tonnes. The project is expected to churn in 1.1 million ounces of silver annually.