BHP Billiton has cleared a key hurdle in its attempt to secure regulatory approval for its bid for Rio Tinto after the Australian Competition and Consumer Commission gave the green light, saying a combination of the Anglo-Australian mining rivals was “unlikely to substantially lessen competition”. Australia joins the US in not opposing the deal, leaving the European Commission as the final antitrust arbiter. The Commission recently restarted its formal merger review process, after delaying it while additional information was sought. It now has until Jan 15 to either block or approve the deal. Regulatory clearance is a pre-condition of BHP’s formal bid, currently pitched at 3.4 of its shares for every one of Rio’s. The takeover has encountered strong opposition from Rio over price and resistance from steelmakers in Asia and Europe. But uncertainty in global markets and BHP’s promise to spend up to $30bn on a buy-back after a deal may play into BHP’s hands.

This entry was posted by Gwen Robinson on Thursday, October 2nd, 2008 at 5:26 and is filed under Capital markets, M&A. Tagged with bhp billiton, rio tinto. Edit this entry.