Rio Tinto £13bn deal with Chinalco set for go-ahead

RIO TINTO'S cash-for-mines-and-shares sell-out to Chinalco of China looked close to completion after it received important US clearances.

Rio Tinto, the global mining giant which is listed in London, New York and Sydney, has disturbed some investors who on the one hand believe their rights have been superseded by the deal while others have queried the uncertainties over the deliverability of the deal.

However, Rio Tinto and Chinalco announced today they have obtained clearance from the US Committee on Foreign Investment which had to look at the deal because of the proposed issue of convertible bonds to Chinalco and its indirect holding in the Kennecott Utah Copper Corporation.

Clearance from the American committee comes in the wake of approvals from the Australian and German competition authorities.

The $19.5 billion (£12.8 billion) deal to tackle Rio's $38 billion debt mountain would see Chinalco invest in Rio mines and shares while the issue of convertible bonds could see the Chinese stake in Rio rise to 18%.

In a statement today Rio said: "We remain committed to delivering this strategic partnership."

Rio shares jumped 41p to 2635p on the news.