BHP takeover of RIO

[treefrog]

Re: BHP raises RIO bid to 3.4 shares

BHP results (today) starting to reflect the effects of a little easing in global growth as growth trims back
likely to inject a little more sober reflection into the takover offer
thinks we'll see more BHP price downside over coming weeks

 

[Pager]

Re: BHP raises RIO bid to 3.4 shares

Looks like BHP clearly wont be overpaying for RIO, they have offered a premium to what RIO was trading at before the bid (about 2.8 BHP to 1 RIO)and know the RIO board have a hard choice to make.

 

[Nyden]

Re: BHP raises RIO bid to 3.4 shares

That's better. Rio had no business in being in the green today! :

It's still overpriced by a dollar or so ... based on 3.4 * BHP's SP
Why would that be? People hoping for a rise in BHP? Buy BHP then?

Hoping for an increased offer? Meh ... won't happen.

 

[tigerboi]

Re: BHP raises RIO bid to 3.4 shares

everyone has forgotten 1 thing:ACCC...unless there has been a nod & wink

agreement from the accc then surley on competition grounds it wont be

allowed,if so the 4 banks will scream blue murder,toll v patricks had to make

them ride shotgun as asciano,firstly i think rio wont accept & it wont get

past the accc.....tb

 

[tigerboi]

Re: BHP raises RIO bid to 3.4 shares

everyone has forgotten 1 thing:ACCC...unless there has been a nod & wink

agreement from the accc then surley on competition grounds it wont be

allowed,if so the 4 banks will scream blue murder,toll v patricks had to make

them ride shotgun as asciano,firstly i think rio wont accept & it wont get

past the accc.....tb

surely is the proper way....

 

[Nyden]

Re: BHP raises RIO bid to 3.4 shares

everyone has forgotten 1 thing:ACCC...unless there has been a nod & wink

agreement from the accc then surley on competition grounds it wont be

allowed,if so the 4 banks will scream blue murder,toll v patricks had to make

them ride shotgun as asciano,firstly i think rio wont accept & it wont get

past the accc.....tb

& If that happens ... BHP continues to drop based on less polished earnings, Rio plummets back to -90c ... who wins there? :

 

[numbercruncher]

Re: BHP raises RIO bid to 3.4 shares

& If that happens ... BHP continues to drop based on less polished earnings, Rio plummets back to -90c ... who wins there? :

BHP wins by avoiding over paying for a company priced on boom time profits

 

[cordelia]

Re: BHP raises RIO bid to 3.4 shares

BHP Billiton 'A1/P-1' ratings on review for downgrade on Rio Tinto bid - Moody's

read it here:

http://www.hemscott.com/news/latest-news/item.do?newsId=59534689175084

 

[mayk]

Re: BHP raises RIO bid to 3.4 shares

Rio Tinto rejects latest BHP Billiton bid

http://www.marketwatch.com/news/sto...3C-4788-99A7-74AAFD7171DF}&dist=TQP_Mod_mktwN

 

[tigerboi]

Re: BHP raises RIO bid to 3.4 shares

rio just anns.1 hour ago of a 3bn ore find in the pilbara,as i said yesterday

3.4 shares not enough & accc may not approve..

 

[tigerboi]

Re: BHP raises RIO bid to 3.4 shares

here is a story on the bhp/rio battle from yesterdays resource investor...tb


BHP Launches $147.4B Hostile Bid for Rio Tinto; Will Chalco Make a Move?

By Jane Louis
06 Feb 2008 at 06:17 AM GMT-05:00


CAPE TOWN (ResourceInvestor.com) -- BHP Billiton [NYSE:BHP; LSE:BLT; ASX:BHP] has launched a $147.4 billion hostile takeover offer for rival Rio Tinto [NYSE:RTP; LSE:RIO; ASX:RIO] today. If the bid is accepted, it would create the third-largest company in the world, which has already raised concerns among competitors - especially Chinese companies - that a combined BHP-Rio Tinto would have too much strength in the pricing of iron-ore and other commodities.

Today’s bid of 3.4 BHP shares for every Rio share represents a 13% improvement over BHP’s original three-for-one friendly share offer in November. BHP may face a roadblock, however, from a surprise move Friday in which Aluminum Corp. of China (Chalco) [NYSE:ACH] partnered up with Alcoa [NYSE:AA] to buy shares in Rio worth $14 billion, making it the company’s largest shareholder. Chinese companies have been particularly vocal in their concerns over the expected power of a combined BHP-Rio Tinto, and rumours have been floating about that Chalco could make a rival bid.

Rio rejected BHP’s original bid, saying it was too low. The company declined to comment on today’s sweetened offer at the Mining Indaba in Cape Town, South Africa.

“We have no comment at this time,” Jean Chawapiwa-Pama, a spokesperson for Rio's communications and external affairs in Africa, told Resource Investor. “We have received the offer, and the board is reviewing it.”

A Force to Be Reckoned

London-based Rio Tinto produces iron ore, coal, copper, bauxite, alumina, aluminium, uranium and diamonds and holds operations in Australia, North America, South America, Asia, Europe and Africa. Its two biggest revenue makers in the year ended December 2006 were iron ore and copper, bringing in about $7 billion. Energy commodities and aluminium each produced about $4 billion.

BHP, based in Melbourne, has more than 100 operations worldwide and produces aluminium, base metals, iron ore, diamonds and specialty products, manganese, coal, petroleum and stainless steel materials. The company made $6.9 billion last year on stainless steel production. Petroleum, base metals and aluminium brought in about $6 billion each, while iron ore made $2.7 billion.

The deal between two of the top three iron ore producers would create a global force in iron ore output. Rio produced 132.78 million tonnes of iron ore in the year ended December 2006, while BHP had an output of 98.197 million tonnes in the year ended July 2007. A combined Rio/BHP company would hold 27% of the world market for iron ore, matching the production of rival and world leader Vale [NYSE:RIO].

A common theme at the Mining Indaba has been China and India’s growing economies. As these emerging countries continue to develop, their resource needs will continue to boom. China, in particular, currently has a skyrocketing demand for stainless steel and iron-ore, and India’s GDP growth is increasing at a rate about 10 to 15 years behind China, meaning that demand will stay strong in the country throughout the coming decades.

A Possible Bid from China?

Chalco’s share increase on Friday led analysts to speculate that the company may be planning a bid of its own. The aluminium giant has yet to make a statement, and sources said it may not be in any hurry.

Giles Taylor, co-head of the mining and metals team at Barclays Capital, told RI that while he couldn’t comment on the offer itself, the unsolicited bid from BHP and Chalco’s share boost make it an interesting story.

“I think it’s quite a clever strategy,” he said.

Taylor said consolidation is going to continue being a main theme in the mining sector. While mergers and acquisitions used to be about diversifying assets, now it’s about adding capital and synergies.

“That has never happened before in the industry,” he said. He said like everyone else, Barclays will have to wait and see what happens.

BHP lost $3 yesterday to close at $69.48 on the NYSE, while Rio Tinto lost $10.66 to close at $421.50.

 

[Pager]

Re: BHP raises RIO bid to 3.4 shares

Been a while with no news about were the bid is going, so what happens next

Is there any time condition on BHP,s offer ?, at what point is it a non starter or could this drag on and on ?.