Tata Steel sells $1bn Riversdale stake to Rio Tinto

Prasenjit Bhattacharya and Kenan Machado 

  • From:Dow Jones Newswires 

  • June 17, 2011 5:47AM

  • INDIA'S Tata Steel says it has decided to sell its entire 26.27 per cent stake in Riversdale Mining to Rio Tinto for about $1.06 billion, giving Rio Tinto complete control of the Africa-focused coal mining company.
    Tata Steel said last night it was selling its stake as it didn't want to remain an investor in a soon-to-be delisted company if it didn't have a joint venture agreement with the majority owner.
    Rio Tinto plans to delist Riversdale and, following the Tata Steel stake sale, it will hold more than 99 per cent in Riversdale, leaving the free float of shares at just 0.3 per cent of the total equity.
    After Brazil's Companhia Siderurgica Nacional sold its 19.9 per cent stake in April, Tata Steel was the only remaining major stakeholder which hadn't complied with Rio Tinto's request.
    Tata Steel said it would continue to hold its 35 per cent stake in a unit of Riversdale that owns the Benga mines in Mozambique, where the two companies have a long-term coking coal offtake agreement.

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