Rio Tinto may shake up Ivanhoe management
MELBOURNE -(MarketWatch)- Rio Tinto PLC RIO +0.38% expects to replace some directors and management at Ivanhoe Mines Ltd. IVN +4.29% after grabbing majority control of the Canadian mining company, and may seek direct ownership in the massive Oyu Tolgoi copper and gold project in Mongolia.
The Anglo-Australian mining company doesn't currently have any plans to shake up Ivanhoe, but is reviewing its investment in the company and anticipates replacing some of the management and at least a majority of the non-Rio appointed directors, according to a Thursday filing from Ivanhoe to the U.S. Securities and Exchange Commission. The change will give Rio more than a majority on the Ivanhoe board, it said.
Rio reserved the right to increase its holding in Ivanhoe as well as the right to make proposals "alone or with a third-party" regarding Ivanhoe's existing investment, ownership in Oyu Tolgoi or other changes, the filing added.
Rio earlier this week said it has bought an additional 15.1 million shares of Ivanhoe, increasing its interest to 51% from 49% at a cost of C$302 million (US$301 million). It said it has no current plans to buy more shares.
Ivanhoe owns 66% and Mongolia's government the remaining 34% of Oyu Tolgoi, which is expected to be one of the world's largest mines when fully operational. Annual output in the first 10 years is projected to average 1.2 billion pounds of copper, 650,000 troy ounces of gold and more than 3 million ounces of silver.
Rio is operator of the project, which is due to begin commercial production in the middle of 2013. Rio has steadily increased its holding in Ivanhoe over the past two years, and effectively controls the Vancouver-based company's board, with three employees and four nominees among the 14 directors.
The Anglo-Australian mining company doesn't currently have any plans to shake up Ivanhoe, but is reviewing its investment in the company and anticipates replacing some of the management and at least a majority of the non-Rio appointed directors, according to a Thursday filing from Ivanhoe to the U.S. Securities and Exchange Commission. The change will give Rio more than a majority on the Ivanhoe board, it said.
Rio reserved the right to increase its holding in Ivanhoe as well as the right to make proposals "alone or with a third-party" regarding Ivanhoe's existing investment, ownership in Oyu Tolgoi or other changes, the filing added.
Rio earlier this week said it has bought an additional 15.1 million shares of Ivanhoe, increasing its interest to 51% from 49% at a cost of C$302 million (US$301 million). It said it has no current plans to buy more shares.
Ivanhoe owns 66% and Mongolia's government the remaining 34% of Oyu Tolgoi, which is expected to be one of the world's largest mines when fully operational. Annual output in the first 10 years is projected to average 1.2 billion pounds of copper, 650,000 troy ounces of gold and more than 3 million ounces of silver.
Rio is operator of the project, which is due to begin commercial production in the middle of 2013. Rio has steadily increased its holding in Ivanhoe over the past two years, and effectively controls the Vancouver-based company's board, with three employees and four nominees among the 14 directors.
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