Riversdale tells shareholders to accept Rio takeover

7th April 2011, Comments 0 comments

Riversdale Mining on Thursday recommended shareholders accept Rio Tinto's near $4.0 billion takeover bid after the Anglo-Australian giant secured almost 50 percent of the coal group's shares.

Rio said late Wednesday it now held 49.49 percent of Riversdale, as it closes in on winning majority control of the Mozambique-focused group.

In a statement, Rio said the acceptance level had breached its target of 47 percent, and as a result the group has now lifted its Riversdale offer to Aus$16.50 ($17.20) per share from Aus$16.

That values its long-time takeover target at almost $4.0 billion. The offer period closes on April 20.

Last week, Rio had declared the offer unconditional, meaning all of its takeover provisions had been met.

"The Riversdale board unanimously recommends Riversdale shareholders to accept the Rio Tinto offer in the absence of a superior proposal," Riversdale said in a statement.

India's Tata Steel and Brazilian steelmaker Cia Siderurgica Nacional SA (CSN) recently increased their stakes in Riversdale to a combined 47 percent in what appeared to be a move to frustrate Rio.

Riversdale added that executive chairman Michael O'Keeffe and director Andrew Love would quit once Rio's stake reached 50 percent.

© 2011 AFP

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