Rio Tinto, BHP Billiton brace for German project rejection
Anglo-Australian mining giants Rio Tinto and BHP Billiton voiced disappointment Thursday with what they said was the expected rejection by German regulators of their plan to combine iron ore operations in Western Australia.
"BHP Billiton and Rio Tinto have noted with disappointment the statement today by the German Federal Cartel Office that its current intention is to prohibit the companies' proposed iron ore production joint venture in Western Australia," the groups said in a statement.
They said the the German regulatory examination was continuing, with formal notification expected next week.
German cartel officials could not be reached for comment Thursday.
The German newspaper Handelsblatt in its Friday editions reported that the office had told the companies that in its present form the proposal would be rejected.
But the paper added that BHP Billiton and Rio Tinto could avoid a veto if modifications sought by the cartel office were approved. It said German authorities were prepared to postpone their decision until the end of November.
BHP and Rio, the world's second and third largest iron ore miners, want to combine their operations in a 50-50 joint venture in the Pibara region of Western Australia.
Competition authorities in Europe and Asia are examining the project. European steel makers, anxious about rising iron ore prices, contend that the plan is anti-competitive and could in particular penalise the German auto industry.
© 2010 AFP