Rio Tinto to Exercise the Series A Warrants in Ivanhoe Mines
Rio Tinto confirmed today that it has given notice to Ivanhoe Mines Ltd
(Ivanhoe) that it is exercising all of its Series A warrants which will
increase Rio Tinto′s ownership of Ivanhoe shares by 7.3 per cent to 29.6
per cent and provide sufficient funds to Ivanhoe to continue the
development of the Oyu Tolgoi copper and gold complex as currently
scheduled. The Series A warrants entitle Rio Tinto to acquire 46,026,522
shares at a subscription price of US$8.54 per share, for total
consideration of approximately US$393 million.
Andrew Harding, chief executive, Copper, Rio Tinto said 'Exercising the
warrants early ensures Ivanhoe has sufficient funds to meet the current
Oyu Tolgoi development schedule. Our further investment in Ivanhoe Mines
underlines our confidence in the quality of the world class Oyu Tolgoi
deposit and its priority in our project portfolio.?
Rio Tinto and Ivanhoe are development partners for the Oyu Tolgoi
project. Production is expected to commence in 2013, with a five year
ramp up to full production. After the completion of the exercise of the
Series A warrants, Rio Tinto will own 144.66 million shares of Ivanhoe.
If Rio Tinto were to exercise all of its remaining share purchase
warrants and convert its US$350 million loan into shares it would own
approximately 267.8 million shares of Ivanhoe representing an interest
in Ivanhoe of around 44 per cent.
Pursuant to certain existing contractual arrangements between Rio Tinto
and Ivanhoe, Rio Tinto has the right at any time to exercise its
remaining share purchase warrants and/or convert its convertible loan
into shares of Ivanhoe. Rio Tinto also has, among other things, the
right to acquire additional securities so as to maintain its
proportional equity interest in Ivanhoe, and the right to acquire
additional Ivanhoe securities in certain other circumstances and subject
to certain limits.
Depending upon its assessment of Ivanhoe′s business, prospects and
financial condition, the market for Ivanhoe′s securities, general
economic and tax conditions, and other factors, Rio Tinto will consider
availing itself of its rights to acquire additional securities of
Ivanhoe.
About Rio Tinto
Rio Tinto is a leading international mining group headquartered in the
UK, combining Rio Tinto plc, a London and NYSE listed company, and Rio
Tinto Limited, which is listed on the Australian Securities Exchange.
Rio Tinto's business is finding, mining, and processing mineral
resources. Major products are aluminium, copper, diamonds, energy (coal
and uranium), gold, industrial minerals (borax, titanium dioxide, salt,
talc) and iron ore. Activities span the world but are strongly
represented in Australia and North America with significant businesses
in South America, Asia, Europe and southern Africa.
High resolution photographs and media pack available at: http://www.riotinto.com/media/press_kit.asp
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