Rio deny JV dropped

Rio Tinto has denied that it has come to a final decision regarding its iron ore merger with BHP Billiton.

Rio Tinto has denied that it has come to a final decision regarding its iron ore merger with BHP Billiton.

This comes despite Rio chairman Jan du Plessis reportedly telling fellow directors that he did not believe BHP would object to Rio walking away from the joint venture.

The Pilbara iron ore joint venture, worth a massive $120 billion, followed the failed $180 billion acquisition of Rio by BHP two years ago, and to date has faced fierce opposition from Chinese and European regulators.

They voiced concerns about the potential iron ore monopoly the joint venture could create.

Rio is reportedly dropping out of the deal due to its improving financial position, shareholder pressure, and the view that the deal favoured BHP.

Although there has been serious market doubt that the merger would be carried out as early as January this year, there has been very little response from either miner as to this.

However, Rio’s  du Plessis reportedly said ‘I think with regard to the [joint venture] and why it didn’t succeed … we should simply work on the basis that both parties worked well and in good faith to make this thing work and both parties agreed, simultaneously, it wasn’t possible,”.

According the SMH, other directors agreed with the chairman that the JV was no longer viable.

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