Rio Tinto has begun yet another debt reduction program, launching a bond purchase program for up to US$3 billion.
It follows the miner’s earlier ventures this year to pay down its debt early, after repurchasing around US$1.359 billion in outstanding notes in April and launching a cash tender offer for US$3 billion worth of notes in June, both of which were successful.
According to the miner, it has launched its latest buyback in order to take advantage of its strong liquidity position and the improved market.
Under its new plan, Rio Tinto has offered a redemption notice for approximately US$1.5 billion of its 2017 and 2018 notes and begun a cash offer to purchase around US$1.5 billion of its 2019, 2020, 2021, and 2022 notes.
Today, Rio Tinto issued a notice of redemption for all of its 2.000 per cent notes due 22 March 2017, 1.625 per cent notes due 21 August 2017 and 2.250 per cent notes due 14 December 2018 issued by Rio Tinto Finance (USA) plc and for all of its 6.500 per cent notes due 15 July 2018 issued by Rio Tinto Finance (USA) Limited.
These notes are guaranteed by Rio Tinto plc and Rio Tinto Limited and approximately $1.5 billion in aggregate principal amount is outstanding. The redemption date is 26 October 2016.
Rio Tinto Finance (USA) plc and Rio Tinto Finance (USA) Limited are making cash tender offers to purchase up to approximately $1.5 billion of the outstanding securities, each guaranteed by Rio Tinto plc and Rio Tinto Limited.