China eyes 15.85% of Australia's Fortescue-paper

SYDNEY, Feb 4 (Reuters) - China Investment Corp and China Shenhua Group are in informal talks to buy a 15.85 percent stake in Australia's Fortescue Metals Group Ltd (FMG.AX: Quote, Profile, Research, Stock Buzz) for about US$2 billion, the South China Morning Post said on Monday.

Citing unnamed sources, the paper said the proposed deal reflects China's continued search for overseas natural resources to supply fuel for its economic growth.

China Investment is a US$200 billion sovereign wealth fund, and Shenhua is China's largest coal mining firm. (Reporting by James Regan)