BHP might review Rio bid if big asset sales ordered

MELBOURNE (Reuters) - BHP Billiton Ltd/Plc (BHP.AX)(BLT.L) might review its $135 billion hostile bid for Rio Tinto Ltd/Plc (RIO.AX)(RIO.L) if European regulators force it to sell a lot of assets, Chief Executive Marius Kloppers said.

"Clearly should we not be able to get the synergies and the extra volume out of the combination, because of some of these issues, we'll have to think again," Kloppers said in an interview recorded on July 30 for a DVD sent to shareholders with the group's annual report on Wednesday.

The comment came in response to a question on what BHP would do if the European Commission said BHP could buy Rio Tinto but only if it sold vast amounts of it.

Competition regulators in the European Union and Australia have raised concern about the potential impact on iron ore prices from combining Rio and BHP, the world's no.2 and no.3 iron ore miners.

Kloppers reiterated he was confident about the group's argument that growth in production volumes would speed up if the two companies merged.

He said he expects aluminum to remain an important part of BHP Billiton's business, with or without Rio Tinto.

"It is a business that we would like to continue to expand and grow as part of our diversified portfolio," he said.

The Australian Competition and Consumer Commission is due to rule on the bid on Oct 1.

Rio Tinto has rejected BHP's offer of 3.4 of its shares for every Rio share as undervaluing its prospects.

On Wednesday's trade, Rio's share price discount to the value of the offer widened to 18 percent, an indicator of growing doubts about the bid going ahead.

Rio Tinto's Australian shares fell 2.5 percent to A$105.50, while BHP shares were nearly flat at A$37.87.

(Reporting by Sonali Paul; Editing by Michael Perry)