Sponsored Link:

Rio Tinto Gets Canadian Clearance, $40 Billion in Loans for Alcan

From Staff Reports

Worldwide mining giant Rio Tinto PLC (RTP) said yesterday (Thursday) that the Canadian government has signed off on its $38 billion purchase of Alcan Inc. (AL), noting that the deal raises no anticompetitive issues. The Canadian Competition Act clearance was one of the conditions of the deal’s consummation.

Rio also essentially thumbed its nose at the growing worldwide credit crisis by raising a record $40 billion in loans to finance its Alcan buyout. Rio agreed to buy Canada’s Alcan last month in a friendly $101-a-share deal, saving the Canadian aluminum company from a hostile takeover by its U.S. rival, Alcoa Inc. (AA).

The loans came through during one of the shakiest runs the global credit markets have seen in years. The loan package is the biggest ever to a UK-listed company and the fourth-largest worldwide, according to investment banking data provider Dealogic. Four lead banks – including Deutsche Bank AG (DB), Royal Bank of Scotland, SocGen, and Credit Suisse Group (CS), are responsible for the loan’s conception.

Rio Tinto Group is currently rated A+ by Standard & Poor’s and Aa3 by Moody’s. Those ratings will likely be reduced as a result of the loan, due to the higher debt load the company will be carrying.

More on this topic (What's this?)
“Up To 16% Yields … From Steady, Cash-Rich Companies” — Roger Conrad (Stock Gumshoe, 10/19/09)
The 7 Places Canada’s Best Economist is Parking his Cash (The Wikinvest Daily Angle, 9/30/09)
Canada's Place in World University Rankings (Canadian Financial DIY, 10/9/09)
Shocking Salaries (Canadian Business Blog, 9/30/09)
Read more on Investing in Canada, Rio Tinto at Wikinvest
August 31st, 2007

Why Gold Will Surpass $2,500

Few investors realize that inflation is the least of the factors driving the bull market in gold. Other factors, like Venezuela's crackdown on gold exports, are likely to push prices higher. Find out how to play each of the "7 Key Drivers" in our Money Morning Publisher's Series report... Go here to get it for free.




This entry was posted on Friday, August 31st, 2007 at 2:15 pm and is filed under Top News. You can follow any responses to this entry through the RSS 2.0 feed. Due to the amount of comments we receive Money Morning will not be able to respond to all questions. If you have not already registered to leave a comment, once doing so you will receive Money Morning's Daily Email. Responses are currently closed, but you can trackback from your own site.