By Nick Clark
Published: 09 November 2007
BHP Billiton is expected to return with an improved offer for Rio Tinto after the UK-based mining giant rejected a $142bn all-share approach that would create one of the largest companies in the world.
BHP, which has its headquarters in Melbourne, revealed yesterday it had approached the Rio board in the past two weeks outlining a “potential combination with Rio Tinto on terms incorporating a premium”.
Rumours of the “mega merger” between the world’s first and third largest mining groups have repeatedly circulated the market this year and BHP confirmed yesterday in a regulatory statement that it had made an indicative bid.
Shares in Rio Tinto, which is listed in London and Australia, leapt 21 per cent to a record 5,296p, valuing the company at $144bn last night. BHP shares fell 5.6 per cent to 1,656p.