Rio Tinto takeover bid heats up, BHP chief to meet S.Korean cos

Rio Tinto takeover bid heats up, BHP chief to meet S.Korean cos

Seoul: BHP Billiton CEO Marius Kloppers was to meet Tuesday with South Korea’s two biggest steelmakers, the South Korean companies said, a day after facing opposition from Japan’s steel industry to a proposed merger with a rival mining company.

BHP Billiton, the world’s biggest mining company, headquartered in Melbourne, Australia, is seeking to take over Rio Tinto. But its $150 billion (€102 billion) proposal was rejected earlier this month.

Kloppers was expected to meet with Lee Ku-taek, CEO of South Korea’s largest steelmaker Posco, said company spokeswoman Ko Min-jin. He was also to meet Hyundai Steel Co. CEO Park Seung-ha, Hyundai Steel spokesman K.T. Park said.

Kloppers’ meetings in South Korea come after the Japan Iron and Steel Federation expressed opposition to the merger during his visit to Japan on Monday, calling it undesirable for industrial competition and pricing.

After a merger, 60% of Japan’s raw materials imports would have to come from the two companies, the federation said Monday.

South Korea’s steel industry also relies heavily on imports of raw materials.

Posco relies on BHP Billiton, Rio Tinto and Brazilian mining company CVRD, or Companhia Vale do Rio Doce, for more than 70% of its iron ore imports, said Ko, the Posco spokeswoman.

Hyundai Steel said it gets all of its iron ore imports from those three mining companies.

Kloppers, besides calling for support from the South Korean companies on the proposed merger, may also discuss an expected rise in iron ore prices next year, South Korea’s Maeil Business Newspaper reported Tuesday on its website, without citing a source.