Investing
Two Deals Could Help BHP Billiton (BHP) Bag Rio Tinto (RTP)
Published:
At first, the offer by mining giant BHP Billiton (BHP) to buy Rio Tinto (RTP) looked improbable. The $140 billion price seemed quite rich and offering an all stock arrangement might not be attractive to the RTP board and shareholders.
BHP is moving quickly to remedy that. Citigroup (C) has lined up a $70 billion credit facility to help the takeover along, according to the FT.
A second play by BHP management could help finance a hostile run at Rio Tinto, if that is what is necessary to get a deal done. The Times of London is reporting that BHP is looking at selling its petroleum division for $40 billion. The paper writes "BHP’s financial advisers, Goldman Sachs and Citigroup, are understood to have already flown out to China to sound out potential bidders for the subsidiary."
Between the two initiatives, BHP most likely has the resources to make the takeover work. The Vegas odds are beginning to tip in its favor.
Douglas A. McIntyre
Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE
Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
