17 January 2008
Rio Tinto, battling a US$112 billion takeover approach from BHP Billiton Ltd, appointed banks to manage the sale of as much as US$10 billion worth of mines and plants. "Sales programmes are under way,`` Guy Elliot, finance director of London-based Rio, said. "We`re finding that strategic buyers are queuing up for each and every one of those businesses.``
Rio Tinto drew up a US$30 billion list of possible sales in November as part of its plan to repel BHPB. The assets for sale include base metals mines and uranium projects in Australia and the US, as well as some of the businesses acquired through its US$38.1 billion purchase of Alcan Inc.
Losses from the collapse of the sub-prime mortgage market in the US would not affect potential buyers` ability to raise money to acquire assets, Mr Elliot said. The company said on January 16 that it planned to sell US$10 billion worth of assets this year.
The Northparkes copper and gold mine in New South Wales state, Australia, and the Kintyre uranium deposit in Western Australia, are the most attractive assets for sale, said Peter Rudd, a Melbourne-based analyst who helps manage the equivalent of US$755 million at Carrol, Pike & Piercy Pty. Meanwhile, Rio might have to delay a planned aluminum smelter in South Africa because of a power shortage, Eskom Holdings Ltd said.
Eskom, South Africa`s state-owned utility, may have to renegotiate a power accord it signed with Alcan Inc, prior to that company being acquired by Rio, Eskom finance director Bongani Nqwababa said.
Lithium has been removed due to my involvement in the acquisition of lithium prospects in Africa. Contact Carel van der Merwe at firstname.lastname@example.org or +27 62 538 7750 if interested.
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17 January 2008