Sydney, July 03: Mining giant Rio Tinto has confirmed a huge take-up for its record rights offering after investors snapped up the Australian portion, allowing it to pay off a large chunk of its heavy debt.
The dual-listed firm, whose share offer came at rock-bottom prices in Sydney and London, announced a 95 percent subscription among Australian investors following a 97 percent take-up in Britain.
Rio can now slash its debt bill incurred by last year's takeover of Canada's Alcan. The offering worth USD 15.2 billion was the industry's biggest and the fifth-largest in history.
The Anglo-Australian giant announced the move last month along with an iron-ore joint venture with fierce rival BHP Billiton, snubbing a massive cash injection by China's Chinalco.
Chinalco on Thursday said it had taken up its allocation to remain Rio's biggest shareholder, warning that it would keep a close eye on developments.
China has said it may oppose Rio's joint venture with BHP, aimed at merging their vast Western Australia operations, on anti-monopoly grounds.
Australian investors bought 142,149,887 of the new shares, priced at 28.29 Australian dollars (USD 22.50), Rio said in a statement. Rio shares were in a trading halt while underwriters seek subscribers for the remaining 7,865,410.
Bureau Report
First Published: Friday, July 03, 2009, 09:19