* Private equity funds eyeing mines
* China's MMG, OZ Minerals seen as likely bidders
* Rio Tinto mum on asset sales process
MELBOURNE, May 10 U.S. private equity firm
Carlyle Group has submitted a bid for Anglo-Australian
miner Rio Tinto's 80 percent stake in the Northparkes
copper mine in Australia, news agency Dow Jones said on Friday,
citing a person familiar with the bid.
Northparkes is one of several assets Rio Tinto is looking to
sell as it seeks to pare $5 billion in costs and focus on its
best assets to help protect its single-A credit rating in a
weakened commodities market.
Macquarie, which is advising Rio Tinto on the sale, declined
to comment, as did a Carlyle spokesman in Beijing. Rio Tinto
spokesmen were not immediately available for comment.
Analysts have speculated Rio Tinto could fetch as much as $1
billion for the mine. BHP Billiton recently agreed a higher than
expected price of $650 million for the sale of its Pinto Valley
copper mine and a railroad in Arizona to Canada's Capstone
Carlyle, which has no mine investments in Asia, is the
second private equity firm to be linked to the Northparkes
stake, following reports that KKR & Co was looking to
bid. But KKR is no longer in the running, two sources told
Private equity giants have so far typically shunned the
sector, because of its exposure to the risky commodities cycle.
Bankers and analysts see base metals miner OZ Minerals
and Chinese-controlled MMG Ltd, which is
looking for assets between $1 billion and $7 billion to expand
into one of the world's top diversified miners, as likely
bidders for Northparkes.
MMG declined to comment and OZ Minerals CEO Terry Burgess
was not immediately available to comment.
Northparkes, which is 20 percent owned by Japan's Sumitomo,
produced 43,100 tonnes of mined copper in 2012, or about 8
percent of Rio's total copper output, which is dominated by its
Bingham Canyon mine in Utah.
Northparkes' contribution will become even less significant
as the company's majority-controlled Oyu Tolgoi copper mine
ramps up production in Mongolia.
Rio Tinto has not publicly said Northparkes is on the block,
and new Chief Executive Sam Walsh told shareholders he wanted to
keep the asset sale process under tight wraps, reiterating that
the company was not going to give away anything.
"This is not a fire sale," Walsh said at the group's annual
meeting in Sydney this week.