JAKARTA: Rio Tinto Group offers to buy Riversdale Mining Limited, an African-focused coal miner. Both companies have entered a Bid Implementation Agreement (BIA) for a cash offer by Rio Tinto to acquire all of the issued and outstanding shares of Riversdale by recommended off-market takeover bid.The off-market takeover bid fixed at Aus$16.00 per share for all Riversdale shares at approximately Aus$3.9 billion. The offer price represents 46% premium to the one-month volume weighted average price (VWAP) of Riversdale shares to 3 November 2010 and 2% premium to the one-month VWAP of Riversdale shares to 3 December 2010. The offer will be financed through Rio Tinto's existing cash reserves and credit facilities.As cited on Rio Tinto official website, The Riversdale Directors have recommended that shareholders accept their offer and indicated they intend to take it for shares they control in Riversdale. At the moment, Riversdale is managed by three large shareholders, including India's Tata Steel and Brazilian steel group CSN."Rio Tinto's extensive experience in infrastructure and large project development combined with our significant financial capacity means that we are well placed to take Riversdale's asset base through its next phase of development. We believe Rio Tinto is one of the few groups in the world with the capabilities, values and incentives to develop the projects quickly and to a world-class standard, bringing considerable benefit to the people of Mozambique," said Doug Ritchie, Rio Tinto's Chief Executive Energy.The acquisition, he added, provides Rio Tinto an opportunity to establish a coal development pipeline in Mozambique. This corporate act is in line with Rio Tintos strategy to develop large and low-operating coast assets to grow shareholder value. (T05/NOM)
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