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Special Video Alert: China’s role in the BHP - Rio Tinto drama

Posted November 17, 2007

Today’sFinancialNews.com

Baltimore — (TFN): Last week, mining magnate BHP Billiton cheerfully submitted a takeover offer for Rio Tinto worth $174 billion. Rio Tinto rejected the offer.

It doesn’t matter that BHP’s offer constituted a 25% premium to Rio Tinto’s price at the time. And apparently it doesn’t matter that BHP offered an additional $30 billion in the form of a share buyback.

Rumor has it that China Development Bank has started buying up shares in Rio Tinto — so that it would have the power to block a merger between the two largest Australian mining companies. If it’s true, it will be the first time a Chinese state-backed entity has taken a direct stake in a global mining firm.

Resources guru Sara Nunnally explains just why China’s so scared — and what this merger means for the commodities sector in general.

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Posted by Sara Nunnally · Filed Under Gold and Resources 

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