Rio Tinto CEO: We're Too Valuable for Takeover
Rio Tinto isn't interested in a takeover bid from BHP Billiton -- or any other company -- says CEOTom Albanese.
Albanese Wednesday reiterated his position that BHP's offer undervalued his company, "which has a great value story."
In November 2007, BHP offered 3.4 shares for every share of Rio Tinto . Rio's board rejected the bid as well as a subsequent sweetened offer. Albanese today explained to CNBC that in the days since the initial bid, "Our markets have gotten even stronger."
"Over the past two months, aluminum prices have gone up," he said.
And the higher prices for iron ore set by rival miner CVRD are being matched all through the industry. Such metals inflation is "steady and sustainable," Albanese believes, thanks largely to China -- whose demand is "physical, not speculative...We don't see stockpiles being built."
CNBC's David Faber asked Rio Tinto's CEO just what -- if anything -- would make its board agree to a takeover. Albanese maintained that Rio Tinto is secure as a "strong value and momentum story."
"No offer is even close to the value of running as a standalone," he declared.
He pointed to the recent partnering of Alcoa with Aluminum Corp. of China to grab a 12 percent stake of Rio's London-listed shares.
Albanese said the purchase was further proof of Rio's strong position: "They [the partnership] like the way our business is being run -- they're not seeking a seat on the board. That reaffirms what we've been saying all along about value."