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  1. #1
    Member Viking's Avatar
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    Default RIO - Over $100??

    Any taker to estimate when RIO hit the A$100 bench mark???
    It has been up and down around the 90s for a while now~ it would be quite a psychological boost for the stock or perhaps it is a barrier?
    Make everything as simple as possible, but not simpler.
    --- Albert Einstein

  2. #2
    Member Viking's Avatar
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    Exclamation Is the rumor real BHP acquiring RIO?

    They are well over $110 now~ since my last post~ anyway~
    the rumor has it that BHP is acquiring RIO, are they any substance in them?
    I remember someone talking about it a while ago on either the BHP tread of others about this~ but seems the rumor has surfaced again~
    Make everything as simple as possible, but not simpler.
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  3. #3
    F.A.B. Huang Chung's Avatar
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    As I understand it, European anti-trust rules would probably get in the way of a Rio BHP merger.....but if they promised to divest certain assets, there might be a possibility.

  4. #4
    Member Viking's Avatar
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    How do the European anti-trust coming to their picture? may i ask?
    Make everything as simple as possible, but not simpler.
    --- Albert Einstein

  5. #5
    F.A.B. Huang Chung's Avatar
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    Just what I've heard Viking....market domination and all that jazz. Not an expert in the field I'm afraid......

  6. #6
    F.A.B. Huang Chung's Avatar
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    After a very quick Google Viking....

    Resource Investor 12/5/2007.....'However, the flip side is the anti-trust worries that might arise. Indeed, the Australian government has already stated that it would look very closely at ant-trust issues before giving its approval to any merger between BHP and Rio'.

    The Australian 10/5/2007....'It would be by far the world's largest mining group, and would be the world's largest producer of copper, coking and thermal coal, and rival Brazil's CVRD as the world's largest iron ore producer.
    But it would also create serious anti-trust and trade problems in several countries, and could well require significant divestments of assets, which reduce the benefits of coming together'.

    But on the other hand....

    Forbes 11/5/2007.....There are of course a few good reasons why a takeover wouldn't work. A BHP-Rio combination would have a 40% combined share of the seaborne iron ore market, which would rival market leader CVRD (nyse: RIO - news - people ) of Brazil, which has a similarly sized share.

    Australia's Treasurer, Peter Costello, was quoted by The Associated Press as saying that any bid by BHP would have to be scrutinized. "If BHP wants to make an offer for any company, and I'm not saying whether it will or whether it won't, it would have to pass a number of tests, including competition tests," he told reporters in Canberra. But Lehman Brothers' LaFemina believes antitrust should not be "a major issue."

  7. #7
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    Default

    Thank you so much HC~
    Indeed looking at these quotes in May~ whether speculation of such been fuelling the RIO's rise against the trend these couple of days?
    Make everything as simple as possible, but not simpler.
    --- Albert Einstein

  8. #8
    F.A.B. Huang Chung's Avatar
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    Sky Business News said tonight that BHP had recently approached Rio's board, but was rebuffed. Looking to set up another meeting. They must have some ideas as to getting around any competition issues.
    Last edited by Huang Chung; 09-11-2007 at 01:16 AM.

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    No rumours now. It's official and the 1 for 3 share swap pushed RIO in London up some 20 percent. It's actually equivalent to RIO being $130 plus in the Aussie market. Plus all other miners are up except BHP. Big day tomorrow for producing miners like MCR, SMY, IGO, KZL, ZFX.

  10. #10
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    Default

    Small error in this article - wouldn't be largest takeover ever. Vodafone's buyout of Mannesmann in 2000 was for 112b.

    BHP Billiton Offers to Buy Rio; Proposal Rejected (Update7)

    By Tan Hwee Ann and Brett Foley

    Nov. 8 (Bloomberg) -- BHP Billiton Ltd., the world's biggest mining company, plans to pursue a takeover of Rio Tinto Group after an earlier approach was rejected, in what would be the largest acquisition in history.
    A purchase of Rio, which has a market value of $159 billion, would create a company that controls more than a third of the iron-ore market, supplies the most energy coal and copper, and owns mines and oilfields in six continents. Rio, the third-largest miner behind Anglo American Plc, surged 21 percent in London trading.
    ``If the name of the game at the moment is resources in the ground, then why pussyfoot with junior or medium-size miners when you can go to the top?'' said Stephen Pope, chief global market strategist at Cantor Fitzgerald Europe in London. ``This deal will happen, it's just a question of time.''
    The combination would be the biggest in a record year for mergers -- the value of transactions through October overtook last year's $3.5 trillion total, according to data compiled by Bloomberg. A successful bid for Rio may eclipse America Online Inc.'s $124 billion purchase of Time Warner Inc. Time Warner is now half the size it was when the deal was completed.
    Rio rejected BHP's three-for-one share offer, worth 4,968 pence after BHP stock declined 5.7 percent today. Rio shares advanced 946 pence to close at a record 5,296 pence. BHP, based in Melbourne and led by Chief Executive Officer Marius Kloppers, said in a statement to the Regulatory News Service it recently wrote to Rio's board with the outline plan.
    Unanimous Decision
    ``It significantly undervalues Rio Tinto and its prospects,'' Rio, which has a dual listing in London and Sydney, said in a separate statement. ``The boards have unanimously rejected the proposal as not being in the best interests of shareholders.''
    The combination would raise antitrust issues, particularly in the iron-ore market, said Charles Bailey, an analyst at Brewin Dolphin Securities in London. BHP, Rio and Brazil's Cia. Vale do Rio Doce control about 80 percent of seaborne trade in the ore.
    Rio, the world's second-largest iron-ore exporter after Vale, may now decide to combine with its Brazilian rival, according to Ian Henderson at JPMorgan Asset Management in London.
    Vale Partner?
    ``I can't conceive a competing bid from another company coming through,'' Henderson, who manages $7 billion in natural- resource assets, said in a phone interview. ``Rio and Cia. Vale do Rio Doce may throw their arms around one another instead.''
    Vale spokesman Fernando Thompson declined to comment.
    BHP's offer sparked a rally in mining shares. The Standard & Poor's 500 Metals and Mining Index, which includes Freeport- McMoRan Copper & Gold Inc., rose as much as 3.5 percent. BHP was the only stock in the Bloomberg Europe Metals and Mining Index to decline today as Anglo American rose 15 percent and Xstrata Plc climbed 11 percent.
    A five-year advance in metals prices has spurred more than 1,448 bids in the mining industry with a value of about $185.7 billion in the past year, according to Bloomberg data.
    Escondida Mine
    A combination of BHP and Rio would have a market value of about $380 billion and annual sales of about $54.6 billion, based on 2006 figures. Anglo American had revenue of $33.1 billion last year.
    The merger's assets would include a stake in Chile's Escondida, the world's largest copper mine, and have operations in uranium, aluminum, diamonds, silver, lead and nickel.
    BHP's assets include Olympic Dam, Australia's largest underground mine acquired as part of the A$9.2 billion purchase of WMC Resources Ltd. in 2005. BHP hasn't made a major acquisition since. The mine's resources include 79 million ounces of gold, making it the fifth-largest deposit in the world.
    Rio, which reported a 43 percent increase in profit last year to $7.44 billion, will become the world's largest aluminum producer this year after agreeing to buy Montreal-based Alcan Inc. for $38.1 billion. The deal, priced at 1.72 times Alcan's revenue, will quadruple Rio's output of the light metal used in planes and car parts. BHP's offer would be worth more than seven times Rio's sales.
    Shareholder Value
    Acquisitions don't always work, according to an Aug. 15 report by Boston Consulting Group Inc. Mergers valued at more than $1 billion destroy twice as much shareholder value as smaller transactions, it said.
    Andrew Pullar, a portfolio manager at Baker Steel Capital Management LLP in London whose $900 million in assets include BHP stock, expressed concern that the potential transaction needs approval from Rio.
    ``If it's going to be hostile, it's going to be a case of paying too much,'' he said.
    Rio hired Morgan Stanley, Macquarie Group Ltd., Credit Suisse Group and NM Rothschild & Sons Ltd. BHP will use Goldman Sachs Group Inc. and Sydney-based Gresham Advisory Partners Ltd., said people briefed on the transaction.
    Do or do not. There is no try. ~ Yoda

  11. #11
    F.A.B. Huang Chung's Avatar
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    Boy oh boy.....For most of us playing the smaller end of the resource sector, I don't think it will matter whether a bid succeeds or not. Just the fear of any tie ups between Rio / BHP / CVRD, either now or in the future, will likely see the Chinese / Japanese take steps to shore up their supply of commodities so they are not dictated to by just one or two mega suppliers....i.e. deals with, or takovers of our mid-sized miners.

    Looks good for our smaller iron ore companies in particular......

    Opinions anyone??

  12. #12
    Member Viking's Avatar
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    Default

    Well, the rumor now confirmed~ and rejected~
    but the repercusion will be huge IMHO~
    While we were talking about the Chinese coming out with big cheque book~ seems couple of our ones is already actioning to expand their territory~

    I guess, this may make the small/medium miners look more like a takeover target by those mega players in the short-term... be good for the SP~
    Make everything as simple as possible, but not simpler.
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  13. #13
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    Lightbulb

    This one seems got his fact right~ and quite a balanced views~

    Simon Bowers
    Guardian Unlimited

    The world's largest mining group BHP Billiton is seeking to take over rival Rio Tinto in a deal that would catapult it to a market valuation of about $360bn (170bn) greater than that of Microsoft and equivalent to the gross domestic product of Ukraine.

    After weeks of market rumours, Rio today confirmed it had recently received an all-share indicative offer, which had been swiftly rejected. BHP added it was continuing to push for a meeting to discuss its proposals.

    BHP's spurned takeover approach, marks a breath-taking first move for 45-year-old Marius Kloppers, who was only promoted to the post of chief executive last month after the retirement of his mentor Chip Goodyear.

    Mr Goodyear had run the company since 2003, when his predecessor Brian Gilbertson resigned after failing to persuade BHP chairman Don Argus to back a planned bid for Rio. Mr Argus is firmly behind the latest approach.

    Both companies have major listings on the London stock exchange but have strong roots in Australia where many of their mines are located and where they form a central a pillar of the economy.

    A combination would underscore Austraila's vital role in supplying iron ore to the seemingly insatiable Chinese steelmakers in the midst of an unprecedented economic boom.

    While Brazilian firm CVRD is currently the world's largest iron ore supplier, with about 36% of the global market, Rio and BHP's Australian operations are the number one and two suppliers to China, benefiting from comparatively low shipping costs. A merger would give them a global share similar to that of CVRD.

    China accounts for about 40% of world iron ore consumption. Some analysts believe it will produce more than 480m tons of steel this year double the production levels of 2003.

    BHP wants to offer three shares for every Rio share, valuing Rio at a premium of about 20% using Wednesday night's share price. But Rio rejected the indicative offer which, if successful, would be the world's second largest after Vodafone's acquisition of Mannesmann saying it "significantly undervalues Rio Tinto and its prospects". BHP nevertheless said yesterday it "intends to continue to seek an opportunity to meet and discuss its proposals with Rio Tinto".

    Last night Rio shares closed up 946p, or almost 22%, in London at 52.96. The prospect of the merger of the world number one and number three mining groups by market capitalisation sent a wave of speculative buying through the extraction stocks. Among the risers were Anglo American up 474p, or 15%, to 36.45 and Xstrata, up 348p or almost 11% to 35.73. Meanwhile, BHP closed down 100p at 16.56.

    A union of BHP and Rio is unlikely to be cheered by Chinese steelmakers, led by Baosteel. They are already in the middle of tense annual negotiations with the two Anglo-Australian firms and others to set the price for iron ore next year. Mining groups are pushing for rises of up to 50% and believe they have a strong negotiating hand.

    While there may be little Chinese competition regulators can do to block the possible union, analysts believe disgruntled customers may be appeased by the offer of minority stakes in certain assets, if a deal eventually materialises. Other competition issues could be satisfied by selling off assets.

    Conservative analysts' estimates suggest cost savings from a takeover of Rio would be more than $500m, with much of that coming from the two group's operations in Pilbara, Western Australia, where they operate neighbouring iron ore mines with parallel rail and port facilities.

    The value of iron ore mines, and potential synergies from them, are likely to prove central to any takeover discussions should they materialise, but BHP and Rio also have overlapping operations in copper, coal and aluminium.

    Nevertheless, BHP said: "In preparing its proposal, BHP Billiton has examined in detail the regulatory issues and other practicalities of a combination." Rio, meanwhile, made no mention of regulatory obstacles to a merger in its rejection statement.
    Make everything as simple as possible, but not simpler.
    --- Albert Einstein

  14. #14
    F.A.B. Huang Chung's Avatar
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    Just saw Terry McCrann's piece on Sky Sunday Business where he made the suggestion that if BHP were allowed to take over Rio, then they would have to give the junior iron ore players in the Pilbera everything they want in terms of infrastructure access (i.e. rail and ports)...hence FMG's big rise on Friday.

  15. #15
    F.A.B. Huang Chung's Avatar
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    Quote Originally Posted by Huang Chung View Post
    Boy oh boy.....For most of us playing the smaller end of the resource sector, I don't think it will matter whether a bid succeeds or not. Just the fear of any tie ups between Rio / BHP / CVRD, either now or in the future, will likely see the Chinese / Japanese take steps to shore up their supply of commodities so they are not dictated to by just one or two mega suppliers....i.e. deals with, or takovers of our mid-sized miners.

    Looks good for our smaller iron ore companies in particular......

    Opinions anyone??
    Less than one month later and Sinosteel is bidding for Midwest.

    Let the games begin.

  16. #16
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    Hi folks,

    RIO ... technically, the price action on 28072008 has confirmed 25072008,
    as a morning star pattern and working from a geo perspective, we can
    confirm 28082008 as another significant date.

    Here's our astroanalysis for RIO, over the next few months:

    11082008 ... significant and positive ... finance-related???

    13-14082008 ... 2 significant cycles and positive news expected here

    22082008 ... minor and positive lunar aspect

    28-29082008 ... 2 significant and conflicting time cycles, one
    positive and one negative = flat trading at a high ???

    03-05092008 ... significant and negative news expected here,
    as 2 negative RIO cycles, come out to play

    29092008 ... 2 negative and one positive cycle, should focus
    a negative spotlight on RIO, at New Moon

    06102008 ... minor and positive lunar aspect

    13-14102008 ... minor and positive cycle

    24102008 ... minor time cycle

    29-30102008 ... minor and positive light on RIO

    07-10112008 ... minor and positive news expected

    17-18112008 ... significant and positive cycle - finance-related ???

    25-28112008 ... 3 time cycles to bring minor news

    15-16122008 ... 2 aspects to bring significant and positive news

    29122008 ... positive spotlight on RIO

    02-05012009 ... expecting a short and aggressive rally

    07012009 ... minor news

    09-12012009 ... minor and positive ... finances ... ???

    15012009 ... minor news

    26012009 ... minor cycle

    -----

    After a strong start to February 2009, particularly around 02022009,
    the next round of negative cycles should begin, about 11022009 ...

    More later

    have a great day

    paul



    =====
    Disclaimer: yogi makes no claim to be a licenced investment advisor.

    Always consult your licenced advisor or other financial professional expert.

  17. #17
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    ARE WE THERE YET!!!

    Near a bottom!!?

    Craigs have a buy,12 mth target price $66 current price $43.06. "Tier 1 Aluminium will beat expectations again" PE 2015 est 10 , D/Y 7.3% NETT
    EV/EBITDA 5.2

    4 traders 4 buys 6 outperforms 4 holds 4 sells but not upgraded since 12 /10.

    M/star hold valn $38 on 8th Dec


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    S/P $39. 15 Low debt, sustainable div (unlike BHP) re 7.5% yield but fully franked? Two thirds of worlds Iron Ore miners are underwater, many won't re open for a long ,long time.

  19. #19
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    Remember when the title of this thread was a serious prospect?

    Can't count the number of times I was tempted to buy a few - somehow, never did.

  20. #20
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    For the first time in my life I'm seriously considering an op here.Will continue watching and reading about this massive lowest cost producer.DYOR
    Last edited by Joshuatree; 13-01-2016 at 08:49 AM.

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