Turquoise Hill climbs on speculation Rio may take it private
TORONTO – Turquoise Hill Resources Ltd. soared amid speculation that its controlling shareholder Rio Tinto Group is preparing for a commodity-price recovery by increasing its stake in the company.
Rio Tinto has hired Goldman Sachs Group Inc. to advise it as the world’s second-largest miner looks into the possibility of taking Turquoise Hill private, a person with knowledge of the matter said. The news was reported earlier by the Sunday Times.
Shares in Vancouver-based Turquoise Hill rose as much as 19% in Toronto on Monday, the biggest intraday gain since October 2011. The stock was up 14% to C$4.20 at 3:09 p.m. Turquoise Hill’s Oyu Tolgoi copper and gold mine in Mongolia is going ahead with an underground expansion that will more than double its output.
The Sunday Times reported on its website that Rio Tinto is planning to increase its 51% stake in Turquoise Hill slightly, and is hoping a single company or consortium will buy the rest.
Should this happen, shareholders might stand to benefit, according to Aleksandra Bukacheva, an analyst at BMO Capital Markets in Toronto.
‘Only Advantage’
“The only advantage would be if there was a transaction where another entity comes in and consolidates some of the minority stake at a premium,” she said Monday in a telephone interview. Meanwhile, the operational impact would likely be minimal given that Rio Tinto already has a controlling stake in the project. “Unless the entity has some unique technical expertise that benefits the project, not much is likely to change.”
Rio Tinto, Turquoise Hill and Goldman Sachs declined to comment on the story.
Turquoise Hill will begin work on an expansion of the mine at Oyu Tolgoi later this year. The project would increase annual capacity to more than 500 000 metric tons of copper by 2027. Turquoise Hill owns 66% of the deposit.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation