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M&A - Asia

TIMELINE-How the Rio-Chinalco deal unravelled

June 5 (Reuters) - Global miner Rio Tinto RIO.AXRIO.L dumped plans for a $19.5 billion tie-up with China's Chinalco on Friday, agreeing to set up a iron ore joint venture with rival BHP Billiton BHP.AX and raising cash from shareholders instead.

Following is a chronology of the now doomed Chinalco deal, which would have been the biggest overseas investment by a Chinese company.

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* Feb. 2, 2009 - Rio confirms it held talks to sell some assets to Chinalco, responding to media speculation of an impending deal to cut its debt by up to $8 billion.

* Feb. 9 - Rio director and chairman-elect quits after objecting to a potential deal with Chinalco. The move is seen paving the way for the deal to be sealed.

* Feb. 12 - Deal announced. Chinalco will invest $19.5 billion in Rio. It will spend $12.3 billion on stakes of up to 50 percent in nine of Rio’s mining assets and buy $7.2 billion of Rio convertible bonds.

Institutional shareholders are displeased, saying it favours Chinalco, the company’s biggest shareholder, over others. Shortly before the deal is made public, Australia says it is tightening foreign ownership laws by treating convertible debt as equity.

* Feb. 18 - Australian politicians raise questions on deal, warning the deal could make Australia a branch of Beijing’s economy.

* March 4 - Major Rio investors express unhappiness over deal. Some say they will vote against it.

* March 16 - Australia extends its review of the deal till June. Major shareholders voice growing concern over deal.

* March 17 - Rio names Jan du Plessis, chairman of British American Tobacco Plc BATS.L, as its new chairman. Du Plessis joined Rio's board as a non-executive director in September. Australian politicians step up opposition to the deal.

* March 25 - Australia’s competition watchdog clears deal.

* March 26 - Rio says it could sell more assets and reschedule debt if the deal fails.

* March 27 - Chinalco says arranges $21 billion loan from a consortium of banks, led by China Development Bank, to finance the deal.

* April 20 - Du Plessis says Rio will scrap deal if shareholders are opposed to it.

* May 15 - Rio says it is committed to original deal, responding to talk of a revision in the terms to let more shareholders take part in a rights issue.

* May 26 - Chinalco says it is considering changes to deal.

* June 5 - Deal collapses. Rio and BHP say they will combine their major Australian iron ore operations in a 50:50 joint venture. Rio also announces it will raise $15.2 billion in a deeply discounted rights issue.

Source: Reuters (Compiled by Muralikumar Anantharaman; Editing by Lincoln Feast) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))

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