Rio Tinto plays chancy round of Mongolian roulette 7 Dec 2022 After years of wrangling, the fate of a $3 bln offer for the rest of the Oyu Tolgoi copper mine’s partner heads to a vote. A win would make a key piece of growth easier to manage. If the bid fails, minority shareholders face stake dilution and Rio managers may merit the boot.
Disney’s big ESPN choice, Rio Tinto Mongolia drama 15 Sep 2022 Activist Dan Loeb backed away from his demand that the $203 bln media firm sell its sports network. In this Viewsroom podcast, Breakingviews columnists debate whether it’s the right move. And the $94 bln mining giant’s attempt to secure copper supply may need heavier machinery.
Rio’s Mongolian buyout saga has further chapters 13 Sep 2022 Some investors in Turquoise Hill Resources, which owns 66% of the huge Oyu Tolgoi copper project, have spurned the $97 bln miner’s latest pitch. Rio Tinto’s offer is much improved, and backed by the Turquoise board. But minorities have some grounds to hold out for yet more.
Rio’s Mongolian generosity reflects strategic bind 14 Mar 2022 The $120 bln miner has offered $2.7 bln to buy out minority investors in Turquoise Hill, which controls the giant Oyu Tolgoi copper mine. Rio Tinto could have paid less last year. But its lack of metals needed for alternative energy makes it vital to remove any future barriers.
Rio Tinto Mongolian hardball ends up looking soft 13 Dec 2021 The $105 bln miner has offered to write off a $2.3 bln loan to Ulaanbaatar linked to the Oyu Tolgoi copper project. Boss Jakob Stausholm is giving up billions of dollars in interest. But holding firm risked the company being chucked off a project that could bring in a lot more.
Rio Tinto can afford to go halves in Mongolia 3 Sep 2021 The miner’s $14 bln Oyu Tolgoi scheme is over budget and debt-laden, depriving its government partner of a return. Restructuring so only 50% of the project’s free cash pays down debt could restore dividends and win Mongolia over. High copper prices give Rio scope to act.
Rio finds gold plating for Mongolia copper mess 12 Apr 2021 The $131 bln miner and its partner Turquoise Hill have made peace over financing the troubled Oyu Tolgoi project. It’s a deft solution that tries to get most stakeholders to pitch in. Other prickly issues remain, like getting back into Ulaanbaatar’s good books. But it’s progress.
New Rio Tinto boss has Mongolian bullet to bite 18 Jan 2021 Atop Jakob Stausholm’s to-do list is sorting out the miner’s troubled $10 bln Oyu Tolgoi copper project. Satisfying Ulaanbaatar, pushy hedge funds and minority shareholders at once will be impossible. Raising equity and reworking a sticky loan structure are the least-bad options.
Mongolia’s coal IPO squeezes through narrow hole 6 Nov 2019 Ulaanbaatar has picked advisers to list part of its prize mine. It's a tough sell: a landlocked deposit with only one market, a history of political meddling and a decade of false starts. Still, Chinese backing and an upcoming election might help Mongolia pull it off this time.
Mongolian coal IPO may keep wandering 22 Jun 2018 The Central Asian nation revived plans to list its prize mine, seven years after it tried at a $15 bln valuation. Coal prices have rebounded from 2015 lows and Chinese demand is strong. With just one big customer and years of false starts, though, investors will need convincing.
Mongolia’s hangover needs more than IMF medicine 19 Aug 2016 The nomad state hiked interest rates to 15 pct to defend a plunging currency. An IMF rescue seems likely, and the new government has shown it is willing to take the pain needed. Longer-term, the real cure for its economic ills will be to woo nervous foreign investors back.
Rio Tinto goes Genghis on the copper market 6 May 2016 By expanding its $5.3 bln Oyu Tolgoi mine in Mongolia, the miner hopes to ride an upswing in demand. Under-investment in new mines and declining quality could see the market in deficit by 2020. But there’s a risk that copper goes the way of iron ore, into a damaging supply war.
Mongols and miners bow to market reality 19 May 2015 Rio Tinto and Mongolia have ended a two-year stand-off on the giant Oyu Tolgoi mine by both giving ground. The nomad state now has a fix for plummeting investment inflows. While the miner’s hand looks stronger, falling metals prices have made civility the better part of valour.
Mongolia gives a little in investment tug-of-war 7 Oct 2013 As Rio Tinto thrashes out terms for its stalled copper project, a promise of equal treatment for foreign investors bodes well. Mongolia’s rich resources mean overseas groups will tolerate occasional bad behaviour as long as they mostly get their way. That now looks more likely.
Mongolia’s economic fairytale faces reality check 31 Jul 2013 The failure of its fifth-largest bank and delays to the development of a giant copper mine underscores the vulnerable foundations of the country’s boom. Weakness in emerging markets, and commodities, provide further tests. Yet greater economic realism may ultimately be welcome.
Mongolia gets $1.5 bln licence to play hardball 29 Nov 2012 The nomad state got a good deal on its first government bond, but the effects on its development may be less welcome. The money is more likely to plug budget holes than fund needed infrastructure - and could strengthen Mongolia’s hand in tense dealings with foreign investors.
Public investors lose in Mongol mining battle 10 Aug 2012 The nomad state seems set on sinking Chinese state firm Chalco’s bid for coal miner SouthGobi. Wild as Mongolia is, a compromise is conceivable. All sides could come away with something, except for investors who bought SouthGobi shares when they were double their current value.
Mongolia’s task: avoid Nigerian resource curse 4 Jul 2012 The country, which held elections last week, is growing at a blistering rate on the back of its Oyu Tolgoi mine. Nigeria shows what can go wrong when government and private fingers get sticky - the bonanza is wasted and non-resource activity is burdened and disincentivized.
Mongolia’s bounty hunters must out-tough Genghis 16 Sep 2011 The windswept, agrarian Central Asian country might make global investors very rich if plans to develop its plentiful mineral wealth come off. But the land of Genghis Khan is still pretty wild. John Foley takes a look across the steppes at the opportunities and dangers.