Rio moves closer to Riversdale takeover

 
Kasmira Jefford
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RIO TINTO, the mining giant, moved closer in its bid to gain control of rival Riversdale Mining yesterday, after a $3.9bn (£2.4bn) improved offer spurred more shareholders to accept the bid.

In a notice to the Australian Securities Exchange, Rio said the number of shares it either owned or had received acceptances in respect of the offer had risen from 17.86 per cent to 26.13 per cent by Friday night.

A further 8.37 per cent of shares has been put into an institutional acceptance facility that would turn the shares over to Rio if the bid passed the 50 per cent threshold.

The international mining giant last Thursday raised its original $16-a-share cash offer for Riversdale to $16.50, pricing the coal miner and its African operations at $3.9bn.

It also extended the offer period for a third time to 1 April, although the cut off date for the $16.50 offer is 23 March.

Rio’s offer, which has been recommended by all of Riversdale’s board, is still waiting for votes from Riversdale’s two largest investors, India’s Tata Steel and Brazil’s CSN, which hold a combined 47 per cent of voting rights.

Riversdale shares closed at A$15.45 on Australian Securities Exchange, down 0.45 per cent on the day, while Rio’s shares closed at 3,975p on the London Stock Exchange, a rise of 0.3 per cent.

The acquisition of Riversdale would be Rio Tinto’s first major takeover since its $38bn acquisition of Alcan in 2007.

A Rio Tinto spokesman declined to comment yesterday.