Melbourne: Australia’s Riversdale Mining has received a tentative $3.5 billion takeover offer from global miner Rio Tinto and is in talks for a deal, the target company said on Monday.
It confirmed media reports that Rio was offering around A$15 a share for Riversdale, which would value the group at A$3.5 billion ($3.48 billion), only a 6% premium on Riversdale’s close on 3 December.
Rio Tinto earlier said it would not comment on market speculation.
A deal would mark Rio Tinto’s first significant acquisition since its badly timed $38 billion takeover of Alcan at the height of the commodities boom in 2007, which forced it to sell more than $13 billion worth of assets to help slash debt.
Rio Tinto said last week it was on the hunt for small tomedium-sized acquisitions worth around mid-single-digit billions of dollars.