Rio to obtain US$741m from Cloud Peak IPO
Rio Tinto Limited (RIO) said it would receive at least US$741 million in connection with Cloud Peak Energy Inc’s initial public offering and related transactions. The mining giant said the proceeds include at least US$434 million from the sale of part of Rio Tinto’s interest in Cloud Peak Energy Resources LLC (CPER) in connection with Cloud Peak Energy Inc’s initial public offering (IPO) of common stock and a cash distribution by CPER of US$307 million from the proceeds of its debt offering of US$600 million.
Rio Tinto said it expects to retain an interest in CPER of up to 48%.
CEO, Guy Elliott, said it proved the IPO route was the best option for divesting the assets.
“Including the sale of Jacobs Ranch, we will realise proceeds of at least US$1.5 billion before tax for assets that were previously part of Rio Tinto Energy America, while retaining a substantial interest in Cloud Peak Energy Resources LLC,” Mr Elliott said.
The company said it has announced asset sales of US$8.3 billion since February 2008. Additionally, Rio Tinto received a binding offer from Amcor in August 2009 of US$2.025 billion for Alcan Packaging global pharmaceuticals, global tobacco, food Europe and food Asia divisions.
At the close of trade Friday, Rio Tinto shares were trading at $71.22.
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