Rio Tinto Acquires Control of Canadian Miner (RIO, IVN)
Less than a week following an arbitrator’s decision in its favor, Rio Tinto plc (NYSE: RIO) has acquired an additional 2% of the shares of Canadian miner Ivanhoe Mines Ltd. (NYSE: IVN) to bring its ownership to 51% of Ivanhoe.…
Less than a week following an arbitrator’s decision in its favor, Rio Tinto plc (NYSE: RIO) has acquired an additional 2% of the shares of Canadian miner Ivanhoe Mines Ltd. (NYSE: IVN) to bring its ownership to 51% of Ivanhoe. Rio acquired 15.1 million shares in a private transaction for a total price of CDN$302 million.
Rio and Ivanhoe are partners in copper-gold-silver project called Oyu Tolgoi in Mongolia, which is expected to begin production mid-2012.
According to its announcement of the purchase,
Rio Tinto has anti-dilution rights that permit it to acquire additional Ivanhoe securities so as to maintain its proportional equity interest in Ivanhoe. Rio Tinto also has the right to acquire additional Ivanhoe securities under its equity financing right of first offer.
Rio’s shares are down less than -1% at $57.79 in a 52-week range of $40.50-$76.67. Ivanhoe’s shares are down nearly -5% at $17.26 in a 52-week range of $12.11-$29.29.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.