Thursday July 2, 11:28 AM
Rio Tinto sells 97% of new London shares
LONDON (AFP) - Mining giant Rio Tinto (LSE: RIO.L - news) said Thursday investors had bought 97 percent of the new London-listed shares issued by the group to help it raise 9.29 billion pounds.
The Anglo-Australian group had on June 5 announced plans to raise 7.21 billion pounds from the sale of fresh London-listed stock and 2.07 billion from new shares listed in Sydney.
Results of the Sydney rights issue would be announced on Friday, the company said.
"Rio Tinto received valid acceptances in respect of 508,577,688 new Rio Tinto plc shares, representing approximately 96.97 percent of the total number of new Rio Tinto plc shares offered," the company said in a statement on Thursday.
"It is also expected that the results of the Rio Tinto Limited rights issue... will be announced on Friday," it added.
The announcement of Rio Tinto's massive rights issue on June 5 came as it cancelled a controversial tie-up with Chinese state-owned aluminium giant Chinalco in favour of a joint venture with fierce rival BHP Billiton (LSE: BLT.L - news) .
However, the state-run Chinese firm said it had taken up its allocation from the rights issue -- maintaining its 9.3 percent stake and position as biggest shareholder -- and would continue to monitor developments in Rio.
"This was an economically rational decision as it prevented the dilution of our ownership in Rio," it said in a statement.
"Chinalco believes in the long-term prospects of the industry and will continue to explore opportunities to advance its strategic objectives."
Chinalco was to have invested 11.92 billion pounds in Rio Tinto, which instead unveiled an iron ore joint venture with BHP along with the bumper rights issue.
Rio has been searching for extra funds after its purchase last year of Canadian aluminium group Alcan (AL.TO - news) , which saddled the company with some 23.23 billion pounds of debt.
But Chinalco's emergence as a suitor sparked a political firestorm over ownership of Australian assets, leaving Canberra with a difficult choice -- to risk angering either its electorate or China, a key market.
BHP abandoned a hostile takeover bid for Rio last November.
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