Australia has welcomed a Chinese government report putting the blame on market conditions for the failure of a tie up between Chinese industrial giant Chinalco and Australian miner Rio Tinto in June 2009.
According to the Australian press, a detailed report to China's State Council cleared Rio Tinto and the Australian government on the collapse of the deal, putting the blame on market conditions.
The deal was to have helped rescue Rio Tinto from its debts in February 2009 through the $19.5 billion which was to be provided by Chinalco in return for assets. The miner abruptly called the deal off in June of the same year, preferring to raise money through a rights offer and form an iron ore joint venture with BHP.
"They have understood, having done the analysis, the reason why the deal fell over," Trade Minister Simon Crean commented on the issue.
The Australian press also said that Rio Tinto and Chinalco are in discussions that could lead to the development of the Simandou iron ore field in Guinea, in West Africa, at an expected cost of US$12 billion.