Rio’s offer for aluminium producer under scrutiny

THE share market regulator has put Rio Tinto under the microscope as it examines the events leading up to the miner’s $43.9 billion takeover offer for Canadian aluminium manufacturer Alcan. The Australian Securities Exchange, which routinely examines market disclosures by companies before major announcements, said it had taken a close interest in the matter. “Clearly the ASX is taking a very close interest in the matter, but as we do with all companies that are involved in a major transaction,” the exchange’s head of corporate relations Matthew Gibbs said. “Ultimately, if we form a view that if there is a disclosure issue to answer, we have to refer that to ASIC (the corporate regulator). “But I’m not suggesting that’s where we’re at with Rio.” Mr Gibbs said referrals to the Australian Securities and Investments Commission were not made public. “There should be no suggestion at all that ASX is doing anything out of the ordinary with Rio,” he said. “This is part and parcel with our normal supervisory activities.” Last week, the exchange wrote to Rio Tinto asking it to provide details on its disclosures ahead of the deal, to determine if the final announcement was made in timely fashion. Rio Tinto responded yesterday saying that its talks with Alcan, which had been going on for “many months”, were governed by a confidentiality agreement. “We note that there had been speculation in the media that a number of other parties might acquire Alcan,” Rio Tinto said in a written response. “According to press reports, Alcan had confirmed that it was in discussions with a number of possible ‘white knight’ bidders and was conducting an auction process.” After Alcan’s board met last week, Rio Tinto was told it was the preferred bidder. Its shares were not placed in a trading halt until Thursday, when an announcement of the deal was deemed to be imminent. By then, Rio Tinto’s shares had already climbed to a new intraday high of $105.19, above the last record of $104.34 set the previous Tuesday. Yesterday Rio Tinto’s shares lost $4.20, or 4.15 per cent, to $97.10 as analysts digested the whopping pricetag for the miner’s prospective addition to its stable.