Rio Tinto finally managed to get its hands on Riversdale Mining after Brazil’s CSN gave up its stake to them. On Wednesday Companhia Siderurgica Nacional or CSN announced that it had sold its 20% holding of Riversdale Mining to Rio Tinto because the price was right.
This now brings up Rio Tinto’s stake up to 72% and the remaining stake is held by Tata Steel of India. The takeover bid for Riversdale Mining was initially to close on Wednesday but with this development it has been extended nine days to April 29, 2011.
Rio Tinto will be pleased by the latest development as it puts an end to a stalemate that has been continuing since December last year. The minority shareholders took a long time warming up to the deal and the deadline for it has been extended four times. The bid per share price was also raised from $16 to $16.50 per share. This acquisition will help Rio Tinto establish itself in the BHP Billiton dominated coking coal market.
The Indian steel maker Tat Steel has not yet accepted the offer from Rio Tinto for its stake in Riversdale Mining. This may be due to its need for coking coal as a raw ingredient in steel mining. The Mozambique mines of Riversdale Mining are a good source for Tata Steel.