SHANGHAI (REUTERS) - The chairman of China's Hanlong Mining, which is bidding for Australia's Sundance Resources, is under police investigation for harbouring his brother before the latter's arrest on suspicion of murder, local media reported on Saturday.

Mr Liu Han was detained this week along with family members, according to local media reports. The official Xinhua news agency, quoting police sources, said on Saturday that he was being investigated for possibly shielding evidence, among other "serious" criminal offences.

Sundance said on Wednesday that it was not confident Hanlong would meet a deadline to prove financing for its US$1.4 billion (S$1.76 billion) takeover bid after the chairman's reported detention.

His younger brother, Liu Yong, is being investigated in relation to a triple homicide in 2009, according to local media reports. He was recently arrested by the police, Xinhua said.

Officials at Hanlong could not be reached for comment.

Sundance has threatened to walk away from the long-delayed deal if Hanlong misses any further milestones and is in talks with other potential partners to develop its roughly US$5 billion Mbalam iron ore project on the border of Cameroon and the Republic of Congo.

Hanlong launched its offer for Sundance in October 2011 but last year cut its offer price by more than a fifth to A$0.45 (S$0.59) per share after Chinese regulators raised concerns about the cost following a slide in iron ore prices.

China had wanted to develop its own iron ore mines to help break the grip of mega miners Vale, Rio Tinto and BHP Billiton.