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Sit tight on Chinalco deal, du Plessis

Rio Tinto has urged shareholders to reserve their judgements on its proposed deal with Chinalco and keep an open mind for the future at the company’s annual general meeting in Sydney yesterday.

Rio’s new chairman, Jan du Plessis, told shareholders at the meeting the company is committed to pursuing the deal, which is still under consideration from the foreign investment regulator.

The $19.5 billion deal will increase Chinalco’s stake in Rio Tinto and help the company cope with debt issues following difficult market conditions and the purchase of Alcan in 2007.

Du Plessis has shrugged off concerns about the deal and remains confident it will go ahead.

“Chinalco was attractive in early February and for financial and strategic reasons and our stance hasn’t changed,” he said.

Shareholders will be asked to vote on the transaction in June 2009 after the terms and conditions of the contract are finalised.

Du Plessis said completing the deal will be his first priority as chairman to provide the company with funds to kickstart other developments.

“There is a process taking place right now [under Australian law] and we will wait for the outcome and see what it tells us,” he said.

Du Plessis also shunned speculations Rio may be targeted by BHP in the future and assured shareholders the company will listen to their concerns.

Jan du Plessis assumed the role of board chairman on 20 April, replacing Paul Skinner who retired in September 2008.

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