Rio, Mitsubishi make offer for Coal & Allied

Mining giant Rio Tinto and Mitsubishi Corp. on Monday announced a joint proposal to take over Coal & Allied Industries in an indicative deal that values the company at Aus$10.6 billion (US$11 billion). The conditional, non-binding proposal would see Rio, the world's second biggest miner, and Japan's Mitsubishi acquire all of the shares in Coal & Allied they do not already hold, at Aus$122 each -- a 35.4 percent premium. The two companies, which respectively hold 75.7 percent and 10.2 percent of the miner operating in the Hunter Valley of New South Wales state, would end up with stakes of 80 percent and 20 percent respectively after the offer. Perpetual Ltd is the only other major shareholder, with 6.3 percent of the stock, and Rio said it was supportive of the proposal. Coal & Allied said it received the "incomplete, non-binding, conditional and indicative proposal" from Rio on Saturday. "CNA gives no assurances that the indicative proposal will lead to a takeover offer being made," the company said in a statement. Coal & Allied is Australia's sixth-largest coal miner by output.