Rio Tinto Acquires Majority Stakes on Ivanhoe for $284-M
By Erik Pineda | January 25, 2012 2:44 PM EST
Giant global miner Rio Tinto Group bought additional shares of Ivanhoe Mines Ltd for $283.71 million, giving it 51 percent stake on a firm that only a month before had maneuvered to thwart Rio's takeover initiatives.
According to the Australian Associated Press (AAP), Rio Tinto purchased the Ivanhoe shares from two unidentified sellers and paid $20 per share.
Analysts noted that the selling price carried considerable premiums from Ivanhoe's overnight value of $17.85 in Canadian currency.
Most likely, the sale would automatically end the tiff between Rio Tinto and Ivanhoe Mines, with the letter exhausting all efforts at the last minute to bar the former from obtaining Ivanhoe's majority shares.
Ivanhoe mostly engages on gold and copper mining, with focus in Mongolia, which analysts said was the main reason Rio pursued the smaller miner.
The deal sparked speculations that Rio Tinto is now preparing to further increase its stakes on Ivanhoe but the company issued a statement denying such possibility.
"However, Rio Tinto reserves the right to seek opportunities to purchase additional securities," the giant miner stressed on its statement.
Such future decisions, Rio Tinto explained, would be based on many considerations, which include Ivanhoe's general business situation.
Rio needs to further examine Ivanhoe's market share status, its current tax conditions and its capability for further growth.
At present, Rio Tinto's investments on Ivanhoe appears to be heading on the right way, its growth poised to be mainly supported by the Oyu Tolgoi copper and gold mining project started by Ivanhoe in Mongolia.
As per its last assessment, Rio Tinto reported that construction of the Oyu Tolgoi site is now 70 percent completed and with some 9000 employees working on the project, it should be completed by 2013.
Rio added that more than $6 billion will be required to wrap up the site's development but production should commence by the middle part of 2013.
To contact the editor, e-mail:
Most Popular Slideshows
- Prince William & Kate Middleton Caught Flirting In A Countryside Dinner Date [PHOTOS]
- Prince William & Kate Middleton Boards London Train in Casual Disguise, Royal Couple’s Incognito Plan A Huge Hit [PHOTOS]
- Angelina Jolie & Brad Pitt Heads to Malta For New Movie After A Whirlwind French Wedding [PHOTOS]
- 2014 US Open: Hottest Male Tennis Players To Watch [PHOTOS]
Join the Conversation
- Pricey iPhone 6 on Release Date Likely but with 3X Retina Resolution & Mobile Payment Service – Reports
- 5.5-Inch iPhone 6 is iPhone Air on Sept 19 Release Date: 5 Things to Consider Before Buying
- Google Nexus 8 Confirmed as HTC T1 aka Volantis/Flounder with Freshly-Leaked Specs & Features – Reports
- PlayStation 4 Killing Xbox One Costing Microsoft Millions But It's Fine
- Europe, US Next on ISIS’ Hit List, Says Saudi King; Seized ISIS Laptop Reveals Terrifying Bio-Warfare Plans
- iPhone 6 On Release Date To Feature Qualcomm MDM9625M LTE, 1GB RAM, Mobile Payment Deal With AMEX, 1334x750 Display
- Google Can Kill Samsung with Android KitKat and Android One: Here's How