It so makes me laugh when I read paragraphs like the following that have continued to emerge throughout the bid...it is clear that RIO "leaks" this kind of stuff in order to try and influence shareholders who are wavering...
"One potential outcome is that Rio Tinto gains just over 50 per cent control and buys out Tata and CSN's stakes in Riversdale at a later date, potentially at a lower price than the current offer if coal prices fall, sources familiar with the deal say."
Anyway, I am sitting tight on my remaining holding and am prepared to stump up more equity if called to fund development. But if the offer goes unconditional at $16.50 I may accept...However, I believe that RIV can and should raise project finance debt as well as a moderate amount of new equity for any development. An ungeared balance sheet does not make any sense and so it is again another attempt to influence weaker shareholders with comments from Steve Mallyon about the possible raising of $3bn of new equity to fund the Zambeze project.
regards DF
RIV Price at posting:
$16.07 Sentiment: Hold Disclosure: Held
