Glencore Xstrata and Indian firms eye Rio’s $10bn assets for sale
Mining giant Rio Tinto (ASX, LON: RIO) has reportedly drawn up a shortlist of potential buyers for its $10 billion in assets the miner put for sale earlier this year, in an effort to curb costs and bolster its balance sheet.
According to The Australian (subscription required), the company’s NorthParkes copper mine in NSW, its thermal coal operations in NSW and Queensland, as well as a $5 billion) float of diamond assets have drawn the interest of Indian companies and titan Glencore Xstrata (LON:GLEN).
US-based private equity group Blackstone and Glencore Xstrata, in turn, are said to be getting ready to bid on Rio Tinto’s 59% stake in Iron Ore of Canada (IOC), valued by Rio at around $8 billion.
Rio put its stake in the Canadian company up for sale in March, appointing investment banks Credit Suisse and CIBC to lead the sale of most of it shares in IOC.
The firm is allegedly seeking between $3.5 billion and $4 billion for its stake in IOC.
The sale of non-core assets and recent staff reductions are part of CEO Sam Walsh’s plans to reduce operating costs by $5 billion over the next two years.