14th Oct 2015 08:53
LONDON (Alliance News) - Rio Tinto PLC Chief Executive Sam Walsh has said he has no intention of launching a bid for fellow mining major Glencore PLC, on the same day Rio lost a court case in Australia concerning royalty payments, the Wall Street Journal reported in separate articles on Wednesday.
Walsh said in an interview Tuesday that he doesn't think Rio's and Glencore's businesses are well aligned and that Glencore operates in different geographic areas, adding that there is a "different culture" at Glencore.
Rio rebuffed a proposal by Glencore Chief Executive Ivan Glasenberg last year to merge the two mining giants. Industry watchers thought Glasenberg would likely make another move for Rio this year, but the company's sharp stock decline has sidelined any plans for big deals by Glencore for now.
With Glencore laid low in recent weeks by concerns over its debt, speculation has swirled about it becoming a takeover target. The firm's market value has dropped to about GBP17 billion from about GBP40 billion at the beginning of 2015.
http://www.wsj.com/articles/rio-boss-sam-walsh-says-no-interest-in-bidding-for-glencore-1444749386
In a separate article, the WSJ reported that Rio Tinto must pay royalties to companies run by Australia's richest person, Gina Rinehart, and the heirs of her late father's former business partner from iron ore it digs up in two areas of the Pilbara region in Western Australia.
The High Court ruling was made after Rio argued it wasn't liable to pay royalties on property acquired 45 years ago from Rinehart's Hancock Prospecting Pty Ltd and Wright Prospecting Pty Ltd - operated by the family of Peter Wright, the former partner of Rinehart's late father Lang Hancock.
Rio's case mainly centred on Rio having briefly relinquished control of some of its land in the area back in the 1970s, the WSJ reported. The mining area in question is home to Rio's Channar mine, operated in joint venture with Sinosteel Corp and Eastern Range mine, which it runs with Shanghai Baosteel Group Corp.
http://www.wsj.com/articles/gina-rinehart-wins-legal-battle-against-rio-tinto-1444787189
Rio shares were up 0.7% to 2,540.50 pence per share on Wednesday morning, while Glencore shares were up 0.2% at 118.25p.
By Joshua Warner; [email protected]; @JoshAlliance
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