The board of directors of Australian mining company Riversdale Mining Ltd. (RIV.AU) has recommended accepting a proposal by Rio Tinto PLC (RIO.LN) to acquire the company for A$16 a share, Rio Tinto said in a filing to the Australian Stock Exchange Monday.

Rio Tinto said Riversdale shareholders should accept the proposal as the deal values the company's shares at an attractive premium.

Riversdale's shares closed Monday at A$16.65 on the Australian Securities exchange.

Rio Tinto said all directors on Riversdale's board recommended the proposal, apart from the nominee of Riversdale's largest shareholder, Tata Steel Ltd. (500470.BY), who abstained from voting.

A Tata Steel spokesman, who didn't wish to be named, declined to comment on the company's stance on the bid.

Tata Steel owns a 24% stake in Riversdale, which has 13 billion metric tons in coking and thermal coal resources in its Benga and Zambezi projects in Mozambique.

-- By Prasenjit Bhattacharya, Dow Jones Newswires; 91-11-4356-3358; prasenjit.bhattacharya@dowjones.com
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