European Commission opens investigation in merger of Rio Tinto, BHP Billiton

By Lisa Kerner

Charlotte, N.C., July 7 - The European Commission opened a detailed investigation under the EU Merger Regulation into the proposed acquisition of Rio Tinto Ltd. by BHP Billiton Ltd.

The commission has until Nov. 11 to decide whether the merger impedes effective competition within the European Economic Area or a substantial part of it, a Commission news release said.

According to Rio Tinto, both companies are British-Australian dual-listed companies that mine and market a range of commodities such as iron ore, coal, uranium, aluminum, mineral sands, copper and diamonds, as well as various other base metals and industrial minerals.

"The commodities produced by BHP Billiton and Rio Tinto are basic inputs for major industrial sectors and are therefore crucial for Europe's competitiveness," competition commissioner Neelie Kroes said in the release.

"The recent surge in commodity prices has had a serious impact on the industries buying these commodities, their customers, and ultimately all the consumers in Europe and elsewhere in the world," Kroes added.

The main commodities at stake are iron ore, coal, uranium, aluminum and mineral sands.

In BHP Billiton's offer for the company, Rio Tinto shareholders would receive 3.4 BHP Billiton shares for each Rio Tinto share, it was previously reported.

Rio Tinto is a mining group based in London.

Melbourne, Australia-based BHP Billiton engages in the extraction and processing of minerals, oil and gas primarily in Australia, Latin America and southern Africa.

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