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Rio offers $2.3B for North
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June 23, 2000: 4:30 a.m. ET
UK miner seeks to acquire Australian rival, become 2nd-largest iron ore firm
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LONDON (CNNfn) - Rio Tinto PLC on Friday offered A$3.8 billion ($2.3 billion) for Australian miner North, attempting to create the world's second-largest iron ore producer. The bid met with a hostile response from its target.
London-based Rio, the world's largest mining company, unveiled a cash offer of A$3.80 per North share, a 30 percent premium over the closing price Thursday. Rio backed up its approach by buying a 14.5 percent stake in North, to make itself the Australian firm's largest single shareholder.
North stock rose 34 percent to A$3.92 after the offer was made, indicating investors thought there could be a higher offer.
"North has a number of assets that are complementary with Rio Tinto's,"  said Leigh Clifford, Rio's chief executive.
In a brief statement North acknowledged the offer, but said: "The board considers the offer inadequate." The statement said the board would meet as soon as possible to discuss the offer.
Melbourne-based North is involved in iron ore mining and the extraction of gold, copper and uranium.
Rio tried last year to merge its Australian iron ore operations with those of main rival Broken Hill Proprietary Co. last year, but that deal fell apart. BHP told Reuters it was keeping an eye on developments regarding North and Rio.
Rio (RIO) stock rose 9 pence to 999 pence in early London trading Friday. 
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Rio Tinto
North Limited
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