Rio Tinto (RIO) Boosts Riversdale Bid to $3.9 Billion

With two major shareholders withholding support for the acquisition of Mozambique-focused coal miner Riversdale Mining, Rio Tinto (NYSE:RIO) has increased its bid for the company to $3.9 billion.

Investors doubted the move would be enough to secure the 50.1 percent acceptances Rio wants and sent Riversdale's shares down as much as 2.4 percent.

"The market's clearly a bit skeptical that it will get across the line," said Peter Chilton, an analyst at Constellation Capital Management, which owns shares in Rio Tinto.

Rio Tinto raised its offer price by 3 percent to A$16.50 per share on Thursday and extended the offer period for the third time, to April 1, but said the new offer was its final one if there were no competing offers.

Standing in Rio's way are India's Tata Steel , the world's No. 7 steelmaker, and top Brazilian steel producer CSN , who have increased their stakes in Riversdale since the bid and now hold a combined 47 percent.




Source: Melbourne (Reuters)