The BHP Billiton board decided Tuesday that it “no longer believes” that the offer for Rio Tinto would be in the best interests of BHP Billiton shareholders. The miner cited dropping commodity prices and a European Commission demand for certain divestments.
BHP Billiton’s long chase for Rio Tinto ended due to falling commodity prices and EC limitations
It is not clear what affect, if any, this will have on the companies’ diamond mining position.
In its bid for Rio Tinto, BHP offered 3.4 of its shares for each Rio Tinto share. Rio Tinto has rejected the offer, saying it fails to recognize the underlying value of Rio Tinto’s quality assets and prospects.
While it the Australian Competition and Consumer Commission (ACCC) and the U.S. Department of Justice decided not object to the deal, the European Commission (EC) opened an in-depth investigation into the proposed acquisition. This developed into a key issue for BHP Billiton.
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