Rio Tinto Rights Issue to Reduce Debts

17 June 2009 (Last Updated June 17th, 2009 18:30)

Australian mining giant Rio Tinto has launched a $15.2bn rights issue to meet its debt obligations and improve financial stability. The world’s fifth-biggest rights issue was announced earlier this month after the scrapping of a $19.5bn investment deal with Aluminum Corporation of China

Australian mining giant Rio Tinto has launched a $15.2bn rights issue to meet its debt obligations and improve financial stability.

The world’s fifth-biggest rights issue was announced earlier this month after the scrapping of a $19.5bn investment deal with Aluminum Corporation of China (Chinalco).

The company, however, warned the trading outlook for the balance of 2009 remains uncertain due to pricing issues of spot iron ore, copper and aluminium.

Rio said it has settled iron ore prices for the 2009-10 contract with some important Asian customers while negotiations with China have been affected by the Chinalco deal loss.

The offer is open until the end of June 2009.