Rio Tinto: Announces US$19.5 Billion Partnership With Chinalco
February 12 2009 - 1:52AM
Dow Jones News
Anglo-Australian miner Rio Tinto Plc (RTP) Thursday said it
would form a US$19.5 billion strategic partnership with Aluminum
Corp. of China, or Chinalco.
The deal, details of which were widely leaked to the press,
includes a US$7.2 billion convertible bond issue and US$12.3
billion in asset sales across Rio's aluminum, copper and iron ore
business.
The convertible bond has two tranches with conversion prices of
US$45 and US$60. If converted the bonds will increase Chinalco's
current shareholding in the Rio Tinto Group to 18%.
"Chinalco's cash investment of US$19.5 billion will strengthen
Rio Tinto's balance sheet, increase our flexibility to deliver
growth as markets recover and position Rio Tinto for the next
decade and beyond," said Rio Tinto Chairman Paul Skinner.
The proposed deal will require approval by the Australian
government, shareholders and regulators.
-By Elisabeth Behrmann, Dow Jones Newswires;
61-2-8272-4689 elisabeth.behrmann@dowjones.com