UPDATE: Rio Tinto Fails To Reach Majority In Bid For Riversdale
29 März 2011 - 2:08AM
Dow Jones News
Rio Tinto PLC (RIO) has failed to reach the majority stake it
was chasing in its almost US$4 billion bid to bolster its coking
coal assets with an extensive deposit in Mozambique, but continues
last-minute negotiations with a key shareholder in Riversdale
Mining Ltd. (RIV.AU).
The Anglo-Australian mining company said Tuesday it has raised
its interest in Sydney-based Riversdale and received acceptances
that would give it a 41.04% stake, short of the more than 50%
threshold Rio had set for a sweetened offer of A$16.50 a share by a
late Monday deadline.
Costas Condoleon--a partner at law firm Minter Ellison Group,
which represents Rio Tinto--in a letter released through the
Australian stock exchange said Rio is in talks with a major
shareholder in the coal company to secure a sufficient number of
shares to gain it a majority stake. Trading in Riversdale shares
has been halted.
A successful deal would mark Rio Tinto's first major acquisition
since its ill-timed US$38 billion takeover of Canadian aluminum
producer Alcan Inc. in 2007 and would have landed it control of two
major developing coking coal projects in an area of Mozambique
attracting interest from mining and steel companies around the
world. The success of the deal rested in large part on Riversdale's
two largest shareholders, two steel producers that together own a
47% stake but have remained quiet since the offer was first made in
December.
The offer has been extended four times and was earlier this
month lifted from A$16. Under the terms previously set out by Rio,
the offer now reverts to the earlier price and is set to close
April 6.
Rio Tinto in a statement said it now has an almost 21% interest
in Riversdale and has received acceptances for slightly more than
20% of Riversdale's shares.
Riversdale operates a colliery in South Africa and is developing
two projects in neighboring Mozambique. The company's executives in
January said that should Rio's offer fail, Riversdale would need to
turn to its shareholders, the bond market and other sources to
raise more than US$3 billion needed to fund the projects.
Support for the offer has slowly gained traction in recent weeks
but was always going to be a close call without either Indian steel
producer Tata Steel Ltd. (500470.BY) or Brazil's Cia. Siderurgica
Nacional (SID) selling some or all their shares to Rio. CSN in
February edged up its stake in Riversdale to 19.9% and then Tata
Steel early this month raised its stake 2.9 percentage points to
27.1%.
Analysts have speculated that CSN and Tata increased their
stakes to ensure they can negotiate for supplies of coking coal, a
key raw material in steel making. The two clashed in early 2007
with the takeover of British steelmaker Corus Group PLC, bidding
that was only settled by a nine-round sudden-death auction that
pushed the price for winner Tata up by several billion dollars to
US$12.2 billion.
A spokesman for Tata declined to comment late Monday.
-By Robb M. Stewart, Dow Jones Newswires; +61 3 9292 2094;
robb.stewart@dowjones.com
Riversdale Mining (ASX:RIV)
Historical Stock Chart
Von Aug 2024 bis Sep 2024
Riversdale Mining (ASX:RIV)
Historical Stock Chart
Von Sep 2023 bis Sep 2024