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After nine months, Rio Tinto gets its copper prize

Rio Tinto copper

Some mining companies may have given up after nine months of takeover tussling, but Rio Tinto saw out the journey and finally won majority control of the Oyu Tolgoi copper mine in Mongolia.

Full ownership of Turquoise Hill Resources means the major miner now owns 66 per cent of Oyu Tolgoi, one of the largest copper deposits in the world, with the Mongolian Government holding the remaining 34 per cent. Prior to the takeover, Rio owned 51 per cent of Turquoise Hill.

Rio Tinto first launched its takeover bid of the Canadian mining company in March, offering $US2.7 billion – or $C34 per share – to Turquoise Hill shareholders. This was turned down in August.

Rio’s final offer of $US3.1 billion was accepted in December and the company was granted approval to acquire the remaining 49 per cent of Turquoise Hill by a majority shareholder vote on December 9.

Approval from the Supreme Court of Yukon was the final hurdle, which Rio achieved late last week.

“This acquisition further strengthens our copper portfolio, as part of our strategy to grow in materials the world needs for achieving net-zero and delivering long-term value for our shareholders,” Rio Tinto copper chief executive Bold Baatar said.

“We now have a simpler and more efficient ownership and governance structure, with our partner the Government of Mongolia, as we proceed together towards sustainable production from the underground mine.”

Turquoise Hill has now become a wholly owned subsidiary of Rio Tinto and Turquoise Hill shares will cease trading.

Oyu Tolgoi complements Rio Tinto’s copper assets in the US – Kennecott and Resolution – as well as the Winu project in Western Australia.

The company has a clear strategy to increase its exposure to ‘future-facing’ minerals, with aspirations to develop a leading battery materials business by 2030, which will be focused on lithium and “potentially nickel”.

Rio Tinto owns the stalled Jadar lithium project in Serbia, the emerging Rincon lithium project in Argentina, and the Boron project in California, where lithium is produced from waste rock.

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