Rio Tinto has sold 80 per cent of its interest in the Northparkes copper and gold mine to China Molybdenum for US$820 million.
The sale of the mine, located near Parkes in NSW, is in line with newly appointed CEO Sam Walsh’s regime of cost cutting and turning the company’s focus towards more profitable assets like Rio Tinto’s iron ore operations in Western Australia’s Pilbara region.
Rio Tinto chief financial officer Chris Lynch said “The sale of Northparkes represents great value for our shareholders and demonstrates our continued focus and discipline in the way we allocate capital across the Group.
“Northparkes is a successful business but is not of sufficient size to be a good fit with our strategy. We believe it will have a strong future under its new ownership. Rio Tinto will continue to manage Northparkes to the highest safety and environmental standards during the transition to the new owner.
“The agreed sale of Northparkes follows our recently completed divestment of the Eagle nickel project in the United States while the Palabora sale is now unconditional and expected to close on 31 July. As always, any decision to sell is driven by our focus on delivering the best value for our shareholders.”
The sale is subject to Rio Tinto’s joint venture partners, Sumitomo Metal Mining and Sumitomo Corporation Mineral Resources, waiving or failing to exercise their pre-emption rights under the terms of the Northparkes Joint Venture Agreement.
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