Rio Tinto raises stake in Ivanhoe Mines to 22.4%

By Elisabeth Behrmann
SYDNEY (MarketWatch) -- Rio Tinto Plc /quotes/comstock/13*!rtp/quotes/nls/rtp (RTP 207.80, +3.25, +1.59%) said Monday it has increased its stake in Ivanhoe Mines Ltd. (IVN.T) by 2.7% to 22.4%, the cost of the increase was A$244.7 million and is part of Rio's agreed plan to increase its stake in the Canadian-based company to up to 44%.

Ivanhoe owns the US$4 billion Oyu Tolgoi copper-gold project in Mongolia, which the pair expect will start in 2013, producing 450,000 metric tons of copper and 330,000 troy ounces of gold a year.

The shares have been issued to Rio as part of an arrangement to finance equipment for Oyu Tolgoi.

"Our further investment in Ivanhoe Mines underlines our confidence in the quality of the world class Oyu Tolgoi deposit and its priority in our project portfolio," Rio Tinto Copper Chief Executive Andrew Harding said in a statement.

"We are working with Ivanhoe Mines on finalizing the conditions precedent for completion of the investment agreement with the government of Mongolia and are looking forward to moving into the development phase of the project," Harding said.

Ivanhoe and Rio won a long awaited investment agreement from the government last year but details are still being worked out.

Source:www.marketwatch.com