Rio Tinto is ready to proceed with a rights issue of about $10bn if its agreed $19.5bn fundraising plan with Chinese mining group Chinalco falls through, the FT reported. Rio remains committed to the Chinalco deal, but that could be blocked by regulators or vetoed by shareholders. Plans for the rights issue – to be underwritten by JPMorgan Cazenove and Credit Suisse – were drawn up earlier this year in a plan codenamed Project Glasgow. The rights issue was one of two options to help Rio repay nearly $20bn of debt in the next two years. The miner decided to proceed with the second option – a complex deal with Chinalco which includes a $7.2bn convertible bond and $12.3bn of asset sales.

This entry was posted by Stacy-Marie Ishmael on Monday, April 6th, 2009 at 5:07 and is filed under Capital markets, Commodities. Tagged with rio tinto. Edit this entry.