Rio Tinto PLC (RIO.LN) on Tuesday reconfirmed its recommendation that shareholders vote in favor of the sale of its Coal & Allied Industries Ltd. subsidiary to Yancoal Australia Ltd.
Rio Tinto said the recommendation follows consideration by the board of a counter $2.5 billion proposal from fellow miner Glencore PLC (GLEN.LN) and an improved proposal from Yancoal.
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"We believe Yancoal's offer to purchase our thermal coal assets for $2.45 billion offers the best value and greater transaction certainty for shareholders," Rio Tinto's Chief Executive Jean-Sebastien Jacques said.
Mr. Jacques said Yancoal's revised offer is the most attractive because it removes a deferred payment structure, can meet the timeline set for the transaction, and has given the company certainty regarding the outstanding regulatory approvals required.
Under U.K. and ASX listing Rules, the transaction with Yancoal requires the approval of Rio Tinto shareholders. Rio Tinto PLC has called a general meeting for June 27 and Rio Tinto Ltd. for June 29.
The transaction is expected to be completed in the third quarter of 2017.
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(END) Dow Jones Newswires
June 20, 2017 05:54 ET (09:54 GMT)