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Rio Tinto on Friday said it is terminating disputed agreements it had made with PentWater Capital Management LP and SailingStone Capital Partners LLC in relation to its offer to buy all of Turquoise Hill Resources Ltd, which was announced at the beginning of November.
This follows a consideration of concerns raised by minority shareholders of Turquoise Hill Resources relating to dissent and dispute resolution provisions within the agreements.
On November 1, Rio Tinto said Turquoise shareholders PentWater and SailingStone had agreed to withhold their votes on Rio's takeover of Turquoise.
‘Rio Tinto in good faith has been negotiating with the special committee of Turquoise Hill on comparable provisions for other minority shareholders. However, notwithstanding the parties best efforts, those negotiations have been unsuccessful,’ the miner said.
It confirmed that its offer to the remaining 49% of Turquoise Hill will proceed, and it is seeking a new shareholder meeting date so the transaction ‘can be voted on by minority shareholders as soon as practicable’.
Vancouver-based Turquoise Hill Resources owns 66% of the massive Oyu Tolgoi copper-gold mine in Mongolia, with the Mongolian government holding the remaining 34%. Rio currently holds a 51% stake in Turquoise Hill.
On September 6, Rio Tinto reached an agreement with Turquoise Hill on an improved C$43-per-share, around $33.00, takeover offer.
Rio Tinto shares were 0.3% higher at 5,383.00 pence each on Friday morning in London.
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