Rio sweetens Riversdale bid

10th Mar 2011 08:15

Rio Tinto has enhanced its bid for Riversdale after losing patience with dawdling shareholders, which means it could end up paying A$3.9bn (£2.4bn) for the coal miner.The mining heavyweight, which first offered just $15 a share for Mozambique-focused Riversdale, had raised that to $16. Now it's prepared to pay $16.50, but only if more than 50% accept the deal by 23 March. It has also dropped all conditions other than the minimum acceptance and extended the offer period for the bid by two weeks to 1 April. If successful, it will pay the money within five business days.Rio is adamant it won't be increasing the price any further.Chief executive Doug Ritchie said the new terms give Riversdale shareholders a "highly attractive" premium. "There has been no sign of a competing proposal in the 11 weeks since the bid was announced. The choice for Riversdale shareholders is clear - accept the $16 or $16.50 on offer or risk seeing their share price return to pre-bid levels.""There is no reason to delay acceptance." Tata Steel, which owns 24% of Riversdale, approved the offer in January. Last week, just 19% of Riversdale's shareholders had backed the deal.