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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Rio Tinto Group    RIO   AU000000RIO1

RIO TINTO GROUP

(RIO)
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Rio Tinto asks court to OK sale of partner's diamonds in Canada mine

10/23/2020 | 01:57pm EST

Oct 23 (Reuters) - Global miner Rio Tinto is seeking court approval to sell its partner's share of diamonds from a mine in Canada's Northwest Territories, a filing this week showed, hoping to recover around C$120 million plus legal fees and other costs.

Rio owns 60% of Diavik Diamond Mines Inc (DDMI) and says it is owed C$119.5 million plus about C$2.4 million in fees by junior partner Dominion Diamond ULC.

Dominion holds a 40% stake in the northern mine, located about 300 kilometers (186 miles) north of the territorial capital of Yellowknife.

Closely held Dominion sought creditor protection in April saying it could not afford Rio's cash calls amid coronavirus-related disruptions in the global diamond industry.

Dominion said Oct. 9 a proposed deal to sell its nearby Ekati mine to an affiliate of its parent company The Washington Companies for $126 million fell apart. That deal did not include its minority Diavik stake.

DDMI said in court filings that Dominion has not repaid cover payments and "has no intention of doing so" and that it would be "unjust and inequitable" to not permit DDMI to recover the amounts owing to it in accordance with its joint venture agreement.

"We remain focused on ensuring Diavik diamond mine continues to operate safely, maintaining the mine's significant contribution to the Northwest Territories and local communities through payments to government, employees and suppliers," a spokesman for Diavik said on Friday.

A court hearing on the application is set for Oct. 30 in Calgary, Alberta.

Diavik produced 6.7 million carats in 2019 but is scheduled to close in 2025, with cleanup costs estimated at $365.3 million, according to court documents.

Dominion did not immediately return an email seeking comment on next steps. Rio has said it will not bid on the minority Diavik stake. (Reporting by Jeff Lewis; Editing by Richard Chang)


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
GOLD 0.17% 1810.7 Delayed Quote.21.00%
RIO TINTO GROUP 1.12% 104.28 End-of-day quote.3.86%
RIO TINTO PLC -2.66% 4918.5 Delayed Quote.9.23%
SILVER 0.15% 23.3939 Delayed Quote.32.04%
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Financials (USD)
Sales 2020 42 560 M - -
Net income 2020 9 722 M - -
Net Debt 2020 3 413 M - -
P/E ratio 2020 10,5x
Yield 2020 6,60%
Capitalization 110 B 111 B -
EV / Sales 2020 2,68x
EV / Sales 2021 2,70x
Nbr of Employees 46 000
Free-Float 65,2%
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Mean consensus OUTPERFORM
Number of Analysts 24
Average target price 65,57 $
Last Close Price 65,83 $
Spread / Highest target 45,4%
Spread / Average Target -0,40%
Spread / Lowest Target -33,8%
EPS Revisions
Managers
NameTitle
Jean-Sébastien Jacques Chief Executive Officer & Executive Director
Simon Robert Thompson Chairman
Jakob Stausholm Chief Financial Officer & Executive Director
Michael Gerard L'Estrange Independent Non-Executive Director
Megan Clark Independent Non-Executive Director
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