Rio aims to save Riversdale bid

Rio Tinto is negotiating with a major shareholder in Riversdale Mining in an effort to salvage its takeover bid for the company.

Rio’s $4bn (£2.5bn) offer in December was conditional on at least 50% of shareholders approving the bid.

So far only 41% have said yes despite Rio Tinto saying it will improve its offer by 50 cents per share, should 50% shareholders accept by 23 March.

The deadline for Rio to meet the minimum requirement expires on 6 April.

Stakeholders

The two key stakeholders in Riversdale are Tata Steel of India and CSN of Brazil.

Tata Steel recently increased its stake to 27% and also has a director on the company’s board.

CSN, Brazil’s largest steelmaker, has also increased its Riversdale stake to 19.9%. However it has not made any comments on how it views Rio’s offer.

Rio Tinto’s lawyer said that following the talks on Tuesday, the company will decide whether it will go ahead with the offer free of conditions.

Meanwhile, Riversdale’s shares were put on a trading halt on Tuesday pending an announcement from Rio Tinto.