LONDON, April 18 Rio Tinto told
shareholders on Thursday it saw a lot of appetite for a growing
list of assets up for sale, brushing aside concerns that a lack
of buyers may complicate its efforts to boost profitability and
Mining companies are under pressure from weaker prices and
Rio is trying to sell assets including diamond and aluminium
mines. It has begun the process of selling other operations
including its Northparkes copper mine in Australia, thermal coal
assets and a majority stake in Canada's largest iron ore
But many industry analysts question its ability to find
buyers at a good price, without which Rio faces the threat of a
credit rating downgrade. Rio's debt more than doubled to $19.3
billion in 2012 and Standard & Poor's revised the company's
outlook to negative in February.
"It is the case that we will have a lot of appetite for the
assets that we are considering the sale of. It is not as if
there is only one buyer. There are plenty of buyers - many of
them customers, sovereign wealth funds, competitors," outgoing
Chief Financial Officer Guy Elliott said.
"There is a long list of them that is well financed and able
to buy these assets."
Rio's new management under Chief Executive Sam Walsh faced
shareholders on Thursday for the first time since a shake-up in
January ousted his predecessor following the company's first
ever annual loss.
Shareholders gathered in central London expressed anger over
hefty 2012 writedowns related to Rio's purchase of Canadian
aluminium group Alcan and coal mines in Mozambique.
One shareholder described Alcan losses as "horrific".
"We ... have to acknowledge that the acquisition has had a
significant negative impact on shareholder value and, as our
owners, you have every right to expect that we do better,"
Chairman Jan du Plessis said, adding that the group "almost
certainly paid too much" for Alcan.
The company said it still saw potential in its operations in
Mozambique, which du Plessis said were in their "early days",
denying that Rio had already tried to sell the asset.