International mining group Rio Tinto has now acquired 99.74 per cent of the shares of Riversdale Mining Limited after Tata Steel today allowed its 26.28 per cent stake into Rio Tinto's takeover offer.
Riversdale has hard coking-coal projects in Mozambique and also owns an underground coal mine in South Africa—Zululand Anthracite Colliery. Mozambique is strategically well placed to supply hard coking coal to India and Brazil, where the steel industry is growing and a number of new coal-fired power stations are being built.
Mozambique coal will have a significant freight advantage over Australia and Canada because of the easy shipping route from Beira to the west coast coal ports from Maharashtra to Gujarat.
"This is a great outcome for Rio Tinto,” said energy chief executive Doug Ritchie. “The Riversdale acquisition reinforces our strategy of investing in and operating, long-life, cost-competitive mines and businesses with significant growth potential.
"We have already started to integrate Rio Tinto's world-class operating and technical capability into the operations. We are determined to develop Riversdale's assets in a sustainable, mutually beneficial manner for the people of Mozambique."
Rio Tinto's offer for Riversdale has been made through Rio Tinto Jersey Holdings 2010 Limited. RTJ now intends to compulsorily acquire the remaining shares in Riversdale and seek to have Riversdale de-listed from the Australian Securities Exchange (ASX) after the offer has ended.
The offer, announced in December last year, closes today at 7.00pm (Sydney time). Rio is paying A$16.50 per share, after increasing its offer twice since December.
