After taking a bit of a battering from some of its long-term shareholders, mining giant Rio Tinto is doing its best to appease its investors.
A story in today's Sydney Morning Herald states that Rio Tinto is close to a deal that would allow institutional shareholders to buy bonds on the same terms as its Chinese shareholder Chinalco.
The news will presumably be welcomed by institutional investors, many of whom felt the firm was getting rather too cosy to Chinalco.
According to the report, Rio Tinto plans to offer the bonds to institutions on the same or similar terms, helping to make its 'preferential' deal with Chinalco more palatable to its stalwart investors.
Rio's sudden bout of generosity might set a precedent for other firms that are unable to bribe their investors with dividends or further equity.
Clare Harrison
Deputy international editor
I'm all for preemption rights but at the end of the day we're in a global recession and issuers don't have the time to faff about.
Posted by: John | February 27, 2009 at 11:03 AM
Interesting to see investors lecturing Rio about corporate governance after allowing the company to build up a mountain of debt at the peak of a commodities bubble. Whoops!
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Does anyone use Twitter?
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