UNDERGROUND MINING
Image courtesy of Turquoise Hill Twitter.
With Rio's bid, Turquoise Hill Stockholders Might Make Lots of Profits Rio Tinto owns and operates the Oyu Tolgoi mine, which is located 550 kilometres (342 miles) south of Mongolia's capital Ulaanbaatar, thanks to Turquoise Hill's 66 percent share. Mongolia's government controls 34% of the company.
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urquoise Hill's investors, according to market experts, may get a better offer. Analysts at Scotiabank expect that the company's shareholders will demand a significantly bigger offer from Rio Tinto than the current offer price of C$34/ share, possibly exceeding C$50/share. 26 | SKILLINGS MINING REVIEW May 2022
The second-largest miner in the world has the financial means to pay a larger premium. Rio has $1.6 billion in net cash as of December, and rising iron ore prices are adding to that.
According to Macquarie, acquiring the Vancouver-based miner would increase Rio Tinto's copper output by 10% over the next five years, 17% on average over ten years, and more than 30% by 2032.
The company's readiness to pay is unclear, making the purchase very speculative.
Rio's offer may be a 32 percent premium to Turquoise's closing price, but it is just
