Anglo-Australian iron ore giant Rio Tinto Group has raised its bid for Riversdale in its latest attempt to attract shareholders of the Australia-based coal miner, namely Indian steel giant Tata Steel and Brazil's largest diversified steelmaker Companhia Siderurgica Nacional SA (CSN).
Riversadale owns large coal mines in Mozambique, including the Benga project and the neighboring Zambeze project which have high quality coking coal.
Rio Tinto's new offer price of AU$16.50 per share is up from AU$16.00 and values Riversdale at approximately AU$3.9 billion (US$3.9 billion). The Australian miner is seeking at least 50 percent of Riversdale's stock. The offer is due to close on March 23, 2011, unless further extended or withdrawn.
All major shareholders increase stake
On March 4, the company announced that it had increased its relevant stake in Riversdale Mining Limited (Riversdale) to 17.86 percent, including the acceptance facilities. Rio Tinto's stake was 15.97 percent as of February 16, 2011.
Tata Steel and CSN have recently increased their stakes in Riversdale to 27.1 percent and 19.9 respectively. These two largest stakeholders have not made any moves to sell their stakes to Rio Tinto following the declaration of the bid.
As SteelOrbis previously reported, Rio Tinto and Riversdale have entered into a ‘bid implementation agreement' for a cash offer through which Rio Tinto seeks to acquire all of the issued and outstanding shares of the company.