Fortune Telecom is to acquire a 40 per cent stake in a mining company based in Hubei from its chairman for HK$408 million. Shares of the company will resume trading today. The mining company, owned by Fortune chairman Lau Siu-ying and his two brothers, reported a HK$209,000 loss from revenues of HK$2.24 million last year. Subject to an adjustment mechanism, the total cost could rise to HK$500 million, Fortune said in an announcement to the Hong Kong stock exchange yesterday. Under the deal HK$40 million is to be paid in cash and the balance in new shares. Mr Lau will receive 168 million new shares at HK$2.1905 each - a discount of 21.77 per cent to the last closing price - increasing his stake in Fortune to 325.3 million shares from 207.3 million shares. The mobile phone trading company is diversifying into mainland resources and property development. It is the fifth Hong Kong-listed company to look beyond its core business to expand into the mining industry this year. Property and financial investment company New Times Group Holdings last month agreed to buy control of four zinc-mining firms and take part in a 150 million yuan project in the mainland. In April, Kiu Hung International, a toymaker diversifying into energy, said it planned to invest HK$620 million over the next five years in its newly acquired coal mine in Inner Mongolia. On February 8, New World CyberBase, a Hong Kong-based property company now named Mongolia Energy Corp, surged 155.56 per cent after it unveiled a HK$1.2 billion purchase of a coal mine in Mongolia. Pearl Oriental, a logistics company also expanding into energy and natural resources, has said it would continue to look for energy projects after shareholders in April vetoed a plan to form a venture with a Citic Group unit to develop and buy oil exploitation projects. The mining site to be acquired by Fortune Telecom is located in Huangshi, southeast Hubei and has a general mining area of 0.62 square kilometres. The mineral resources of the site are celestite, zinc and lead, with respective compositions of 5.5 million tonnes, 294,000 tonnes and 62,000 tonnes. Celestite is mainly applied in cathode ray tubes for television monitors.