Three Firms on $1 Billion Rio Tinto Mine Divestment
Anglo–Swiss commodity trader Glencore Xstrata and Japanese trading company Sumitomo Corp. are each acquiring from Rio Tinto a 25.05 percent stake in the Clermont coal mine in Queensland. Glencore will operate the mine and market its coal.
The deal was part of Anglo-Australian mining giant Rio Tinto’s ongoing program of divestments aimed at paying back debts and increasing shareholder returns. In February, the company, hit hard by some bad acquisitions and a sharp drop in commodity prices, announced a loss of $3 billion, the largest in its history.
According to Reuters, Rio Tinto has announced or completed almost $3 billion of divestments this year. The company is currently also looking to sell its majority stake in Canada’s Iron Ore Co., which is valued at around $3.5 billion.
Clifford Chance Sydney partner Mark Pistilli acted for Sumitomo while Glencore was advised by King & Wood Mallesons Sydney partner Nicholas Pappas.
Allens Sydney partner Richard Malcolmson advised Rio Tinto.