September 08, 2008

BHPB bid for Rio - BHP to file Phase 1 for EU approval

The Observer reported that BHP Billiton is set to finally fire the starting gun this month in its bid to take over rival mining giant Rio Tinto in a USD 130 billion plus deal.

As per report, BHP is expected to file its Form CO with the office of Ms Neelie Kroes Competition Commissioner for the European Commission, toward the end of the month.

This will provide the EC with information on how the takeover would affect competition in the mining sector. It will take about five weeks for the EC to decide as it is expected to do whether the proposed deal warrants a lengthier competition investigation. This could take about six more months.

BHP formally tabled its offer for Rio Tinto in February. The offer is conditional on it being cleared by various competition authorities. As well as the EU, BHP will need clearance from the US, South Africa and Australia before the offer becomes 'live' and subject to the normal Takeover Panel timetable. But Mr Tom Albanese CEO of Rio Tinto has so far rejected his rival's advances.