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Glencore Xstrata, Sumitomo to Buy Rio’s Clermont Coal Mine Stake
Oct. 25, 2013 10:45AM PST
Industrial MetalsReuters reported that Rio Tinto plc (ASX:RIO,LSE:RIO,NYSE:RIO) will be selling its 50.1-percent stake in the Queensland-based Clermont thermal coal mine to Glencore Xstrata plc (LSE:GLEN) and Sumitomo Corp. (TSE:8053) for $1.015 billion in cash.
Reuters reported that Rio Tinto plc (ASX:RIO,LSE:RIO,NYSE:RIO) will be selling its 50.1-percent stake in the Queensland-based Clermont thermal coal mine to Glencore Xstrata plc (LSE:GLEN) and Sumitomo Corp. (TSE:8053) for $1.015 billion in cash.
As quoted in the market news:
The sale – for $1.015 billion in cash – will be a welcome boost for Rio’s plan to sell down unwanted assets, as the world’s third-largest miner pares debts of $22 billion, cuts costs and tries to meet shareholder demands for better returns.
Rio said on Friday it had announced or completed almost $3 billion of divestments this year, but its larger planned sales – including a stake in Canada’s largest iron ore producer, Iron Ore Company of Canada (IOC) – have struggled. The miner has already scrapped the sale of its diamond unit and aluminum.
‘It’s not a bad price (for Rio), the market will be reasonably pleased,’ said analyst Des Kilalea at RBC Capital Markets. ‘But the one everyone is looking for is IOC.’