Ivanhoe issue a success as parent Rio Tinto takes its fill

FTSE 100 mining giant Rio Tinto has pumped in just under a billion dollars into its subsidiary Ivanhoe, by taking up its full entitlement in the Asia and Australia-focused miner's rights issue.

Rio paid just under $935m to acquire just over 133.57m Ivanhoe shares, which were being offered to shareholders at $7.00 each.

The purchase means Rio retains its 51% stake in Ivanhoe, now equal to around 510.97m shares.

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Around 99.2% of the shares on offer were taken up by Ivanhoe shareholders, raising $1.8bn (gross) for the company as a result.

The purpose of Rio acquiring additional shares was to honour its contractual obligations to Ivanhoe and to provide additional funding to Ivanhoe to ensure the timely development of Ivanhoe's Oyu Tolgoi copper-gold mine in Mongolia, it said.

The company added that it currently has no intention of acquiring additional shares in Ivanhoe, but said that depending on its evaluation of the business, prospects and financial condition of Ivanhoe, the market for Ivanhoe's securities, general economic and tax conditions and other factors, it may acquire or sell some or all of the securities in the firm.

The share price rose 2.09% to 2,952.50p by 15:19 (against a sector rise of 1.89%).

NR