Rio Tinto announced that it had sold its controlling stake in the Northparkes copper-gold mine to China Molybdenum. The copper-gold mine is located in New South Wales, Australia. Chinese private equity group Cathay Fortune is one of the largest shareholders in China Molydbenum. The molydbenum mining company paid Rio Tinto US$820m for the stake in the Australian mine.
The 80% stake offering was just one of a number of assets the Anglo-Australian mining firm had placed for sale. Rio tinto has been trying its best strengthen its balance sheet and preserve its cherished single-A credit rating. Rio Tinto said that it had sold its stake in the mine in an effort to payoff debt.
Chief financial officer of Rio, Chris Lynch, said that the sale of the controlling stake in Northparkes represented another great value for their shareholders. "Northparkes is a successful business but is not of sufficient size to be a good fit with our strategy," Mr. Lynch explained.
The acquisition is one of the largest this year by a Chinese firm of a mining asset in Australia. China Molydbenum is also currently involved in a takeover struggle for another Australian copper miner, Discovery Metals.
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