Rio Tinto could get over $500m for Cloud Peak

16th Dec 2010 07:44

Rio Tinto will get at least US$2bn for Rio Tinto Energy America after its secondary offering of Cloud Peak Energy shares was priced at around $½bn.The miner is selling 25.6m Cloud Peak shares at US$19.50 each to raise gross proceeds of $499.2m. Underwriters also have an option to pick up an extra $74.1m of stock.It should all be over by 21 December."If the overallotment is fully exercised, this offering would result in the divestment of 100 per cent of Rio Tinto's holdings in Cloud Peak Energy," Rio said Thursday. "With the proceeds from the Cloud Peak Energy transactions and the sale of Jacobs Ranch, the total gross proceeds for the divestment of the majority of Rio Tinto Energy America will be at least US$2.0 billion," finance chief Guy Elliott confirmed.Rio sold its Jacobs Ranch coal mine to Arch Coal in October 2009 for $764m.