Rio Tinto Plc (RIO.AX) (RIO.L) said on Monday it paid about $935 million for 133.6 million shares of Ivanhoe Mines Ltd (IVN.TO), or 51 percent of the stock the Canadian miner put up in a shareholder rights offering.
The purchase allows Anglo-Australian mining giant Rio to maintain its 51 percent ownership stake in Ivanhoe, which is developing the massive Oyu Tolgoi copper-gold project in Mongolia.
Rio paid $7 a common share in the fully subscribed rights offering and now holds more than 510 million shares of Ivanhoe.
Shares of Ivanhoe fell 1.25 percent to C$8.67 on the Toronto Stock Exchange on Monday morning. The stock has halved in value this year.
The offering, which closed on Monday, is part of a financing plan for developing Oyu Tolgoi, located in a remote region of Mongolia, about 80 kilometers (50 miles) north of the Chinese border.
The mine is under construction, with first production expected later this year and commercial production in 2013, according to Ivanhoe's website.
(Reporting by Julie Gordon; Editing by Peter Galloway)