Australian mining giant Rio Tinto takes over in deal valued at £4.85 billion
Rio Tinto, which already owned a majority stake in Turquoise Hill, will buy the Canadian company’s remaining 49 percent for a total price of $3.3 billion, giving the Australian heavyweight full ownership of a company that owns two-thirds of it the Oyu Tolgoi mine in Mongolia.
The Oyu Tolgoi mine, partly owned by the Mongolian government, has faced significant delays since construction began in 2019 and estimated costs have risen from US$5.3 billion to US$6.9 billion.
Rio Tinto chief executive Jakob Stausholm said the deal will simplify administration and provide greater funding security for the future of the Oyu Tolgoi project, which it currently operates.
“Rio Tinto is committed to advancing Oyu Tolgoi in direct partnership with the Government of Mongolia to realize its full potential for all stakeholders,” he said.
The purchase price of C$43 per share is 19 percent higher than the Canadian mining company’s share price at the last close, and Rio Tinto said the price was the company’s “best and final offer” after its previous offers, which the company had paid for C$34 per share buy shares were rejected.
The acquisition has the unanimous approval of the Turquoise Hill Board of Directors’ Special Committee, subject to approval by a two-thirds majority of Turquoise Hill shareholders and a simple majority of minority shareholders.
Shareholders are expected to meet as early as the fourth quarter of 2022 to approve the takeover offer. If approved, Rio Tinto expects to close the acquisition shortly thereafter.
Rio Tinto Copper chief executive Bold Baatar said the deal represented good value for those with minority stakes in the Canadian company.
https://www.smh.com.au/business/companies/rio-tinto-buys-troubled-mongolian-mine-for-4-85b-20220901-p5benf.html?ref=rss&utm_medium=rss&utm_source=rss_business RIO) buys troubled Mongolian mine for $4.85 billion