Rio 'committed to Chinalco'

Jan du Plessis, Rio Tinto's new chairman, said the completion of Chinalco's proposed $19.5bn (?13.4bn) capital investment in the Anglo-Australian mining group would be his priority as he took over from outgoing chairman Paul Skinner. Mr du Plessis made his comments after the dual-listed company's board faced the same shareholder anger at its annual meeting in Sydney as it did last week in London, where large institutional investors remain opposed to the current terms of a deal that doubles Chinalco's stake in Rio to 18 per cent. "I do not like referring to a Plan B," Mr du Plessis said in reference to other financing options Rio might explore to protect itself from the Chinalco deal failing. "We continue to be committed to Chinalco." The new Rio chairman also dismissed reports that he had met Don Argus, his BHP Billiton counterpart, over the weekend. Increasing shareholder support was his focus, he said on his first day as chairman. "I would trust we are not going to put a proposal to shareholders if we think there is any chance of it actually being voted down," he said, while acknowledging: "If shareholders vote down the deal, we will certainly have a problem." Speculation about the deal centres on what concessions Rio and Chinalco might make to ensure that Rio shareholders vote yes. The vote is expected in June following a much-awaited ruling from Australia's foreign investment authority. Mr du Plessis also defended Rio directors over their role in the $38bn acquisition of Alcan, the aluminium maker, which left it with a debt burden forcing the $20bn fundraising from the state-owned Chinese miner. "I think the Alcan acquisition will turn out to be an excellent investment," Mr du Plessis said. Mr du Plessis last week stood down as a director of the UK's Lloyds Banking Group. He will also relinquish his role as chairman of British American Tobacco "in due course". Rio also released the voting results from the combined Sydney and London shareholder meetings, where more than 35 per cent of shareholders voted in protest against the re-election of Sir Rod Eddington, the former chief executive of British Airways, to the board. RiskMetrics, the corporate governance service provider, had recommended that shareholders vote against Sir Rod's re-election over his role as a director at Allco Finance Group, the Australian investment company that collapsed last year. source：www.ft.com