Rio Tinto refers Ivanhoe breaches to arbitration

12th Jul 2010 07:06

Rio Tinto has referred Canadian miner Ivanhoe's breaches of a private placement agreement to arbitration following its adoption of the shareholders rights plan.The mining heavyweight, which recently increased its stake in Ivanhoe to 29.6%, has warned Ivanhoe before it adopted the plan would breach Rio Tinto's contractual rights. But Ivanhoe directors went ahead and adopted the plan on April 6 over Rio Tinto's "strong objection".Last month, Rio exercised all of its Series A warrants to increase its ownership of Ivanhoe shares by 7.3% to 29.6% and promised to provide sufficient funds to Ivanhoe to continue the development of the Oyu Tolgoi copper and gold complex as scheduled. The Series A warrants entitle Rio Tinto to acquire more than 46m shares at a subscription price of $8.54 each, for total consideration of approximately $393m.