Rio Tinto Rejects $147B BHP Bid

Mining giant holds out for an even better offer from rival

By Sam Gale Rosen, Newser Staff

Posted Feb 6, 2008 11:24 AM CST

Copied

Rio Tinto Rejects $147B BHP Bid — In this photograph from BHP Billiton, a worker watches a conveyer belt as iron ore is taken from Mining Area C in the Pilbara in Western Australia in this undated photo. Mining giant BHP Billiton vowed to keep pressing its US$150 billion (euro101 billion) bid to merge with Rio Tinto, telling shareholders... (Associated Press)

Rio Tinto today rejected a $147.4B bid from rival mining giant BHP Billiton, the Wall Street Journal reports. Although the bid would have been one of the largest takeovers ever, Rio is holding out for a sweeter deal. "BHP Billiton's offers, while improved, still fail to recognize the underlying value of Rio Tinto's quality assets and prospects," a company statement reads.

BHP wants to fend off competition from Chinese aluminum company Chinalco, which bought a stake in Rio and sent BHP's shares plummeting, Bloomberg reports. The Chinese operation, which badly wants access to Rio's raw materials, is mulling a counter bid. "Whether BHP will prevail in the end is probably still open to conjecture,'' one analyst said. "Is it enough? Probably not.'' (More BHP Billiton stories.)

Report an error