Buying BHP Billiton’s 37% interest, Rio Tinto will increase its stake in Richards Bay Minerals (RBM) to 74%. The acquisition has been triggered by BHP Billiton’s decision to exercise a put option agreed between Rio Tinto and BHP Billiton as part of RBM’s restructuring in 2009. The final consideration for the acquisition will be determined through a previously agreed valuation process. Completion is subject to regulatory approvals.
RBM is a South African mineral sands mining and processing operation that was established in 1976. Rio Tinto manages RBM and markets its products, including titanium dioxide feedstocks, high purity iron, zircon and rutile. In line with South Africa’s Broad-Based Black Economic Empowerment legislation, the remaining 26% of RBM is owned by a consortium of local communities and businesses (24%) and RBM employees (2%).
Rio Tinto Diamonds & Minerals Chief Executive Harry Kenyon-Slaney said: “RBM is an important part of Rio Tinto’s world-class titanium dioxide portfolio. Doubling our stake in the business solidifies our position at a time when the long-term outlook is strong and demand for higher grade titanium dioxide is growing, driven by urbanization and rising environmental standards.”
Rio Tinto’s global titanium dioxide business, Rio Tinto Iron & Titanium, includes RBM, its wholly-owned Rio Tinto Fer et Titane operation in Quebec; and its QIT Madagascar Minerals (QMM) operation (80% interest).