5 Sep 2022
Turquoise Hill to transfer ownership to UK-based Rio Tinto
On September 5, 2022, Rio Tinto had entered into an agreement to purchase the remaining shares of Turquoise Hill Resources Ltd that it didn't own. The Independent Directors of Turquoise Hill unanimously recommended the minority shareholders to support this transaction. The offer was an all-cash proposal of C$43 per share, marking a 67% premium to Turquoise Hill’s closing price of C$25.68 per share on 11 March 2022. During the transaction period, Rio Tinto agreed to offer short-term liquidity up to US$1.1 billion to Turquoise Hill. However, if not approved, this amount would be repaid from an equity raising in 2023. Turquoise Hill needed an estimated US$3.6 billion to finalize the project and intended to renegotiate debt repayment dates. The transaction provided financing certainty for the Oyu Tolgoi project. Rio Tinto emphasized the benefits of the deal, highlighting the significant premium and financial certainty it offered. The transaction required 66.67% approval from all Turquoise Hill shareholders and a simple majority from minority shareholders. It was anticipated to close in the fourth quarter of 2022. Rio Tinto's financial advisors were Credit Suisse, RBC Capital Markets, and Rothschild & Co. Their legal counsel included McCarthy Tétrault LLP and Sullivan & Cromwell LLP. Turquoise Hill's advisors were BMO Capital Markets, TD Securities, and their legal representatives were Blake, Cassels & Graydon LLP, Norton Rose Fulbright Canada LLP, and Paul, Weiss, Rifkind, Wharton & Garrison LLP.
