Riversdale Mining is still a prime target for Rio Tinto and the global mining giant is working steadily to seal the deal. It raised its offer of $16 a share to $16.50 a share last week and managed to increase the value of the Africa focused mining company to $4 billion. This also saw it get a higher support from existing shareholders up from about 26% on March 14 to around 30% after the deal sweetener was announced.
The main problem for Rio Tinto in the acquisition of Riversdale Mining are majority share holders Tata Steel from India and CSN from Brazil. These two conglomerates control around 47% of Riversdale while Rio Tinto has barely got a 20% stake in the mining firm.
Once Rio Tinto announced its takeover bid last December both the companies have been steadily increasing their respective stakes in Riversdale Mining to have a more decisive word in how the deal goes through. There is even the chance that Brazilian state owned CSN may launch its own separate bid for the mining firm.
What makes Riversdale Mining such an attractive target is the two major coal projects that it controls in Mozambique and a colliery that it operated in South Africa. The mining and steel companies are both interested in acquiring a say in the sale of the coal it produces.