Rio Tinto on verge of becoming aluminium supremoPublished by MAC on 2007-08-30
Rio Tinto on verge of becoming aluminium supremo
30th August 2007
The world's second-highest capitalised mining company has made a giant leap forward some might think, backwards) by agreeing a friendly acquisition of Alcan, Canada's premier integrated aluminium producer. Only an extraordinary shareholders meeting, scheduled for September 14th, stands in the company's way of becoming the world's major player in this field: the outcome is virtually certain.
Underwriting the deal's syndicated US40 billion loan - claimed by Rio Tinto as the largest ever raised in the UK and fourth biggest in the world - are three major investment banks, RBS (UK), Deutsche Bank (Germany) and Credit Suisse (Switzerland).
Rio secures $40 billion loan financing for Alcan purchase
Metal Bulletin, Singapore
30th August 2007
Rio Tinto has completed the syndication of the $40 billion loan and credit facilities it will use to finance its acquisition of Alcan.
The loan is the largest ever raised by a UK corporation and the fourth largest worldwide, it said.
The sub-underwriting phase of the syndication was more than one-third oversubscribed despite the recent volatility in the global credit markets. The facilities were initially underwritten by the Royal Bank of Scotland, Deutsche Bank, Credit Suisse and Societe Generale.
"This extremely attractive response underlines the strength of Rio Tinto's existing asset base, the attractiveness of the Alcan transaction and the solid credit profile of the enlarged Rio Tinto Group," cfo Guy Elliott said in a statement. "This bodes well for our future refinancing plans in the debt capital market." Rio is buying Alcan for about $38.1 billion, or an enterprise value of about $44 billion.
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