China promises $7.8bn for Rio Tinto expansion

CHINA is shoring up support for its investment in Rio Tinto by promising to invest up to $US5 billion in its expansion plans. The Sunday Times in the UK reported yesterday that China’s state-owned Exim Bank has written to Rio saying it is "delighted" at the planned investment by Chinalco and was willing to invest $US5 billion ($7.8 billion) into the company. The report said the deal with Chinalco had aroused anger among some Rio Tinto shareholders because it has ignored their traditional pre-emption rights. Separately, Bank of China wants to take part in the financing of Chinalco’s investment in Rio, the official Xinhua News Agency reported late Friday, citing bank Chairman Xiao Gang. Rio Tinto last month struck the $US19.5 billion deal with Chinalco that will give the Chinese group minority stakes in a suite of assets and convertible bonds that could ultimately deliver an 18 per cent stake in the miner. source：www.theaustralian.news.com.au