RIO has announced it will strengthen its portfolio by divesting non-core assets, including Australian coal assets for $4.2b US. Part of these proceeds will be returned through the launch of an off-market buy-back tender targeting up to 41.2 million Rio Tinto Limited shares (approximately A$2.7 billion1 (US$1.9 billion2)) with the balance of proceeds being allocated to further on-market purchases of Rio Tinto plc shares. 

Eligible shareholders may tender shares at discounts of between 8 per cent and 14 per cent (inclusive, and at 1 per cent intervals) to the Market Price, or as a Final Price Tender (which is an election to receive the Buy-Back Price). The Buy-Back Price will be determined having regard to the Tenders submitted by shareholders and will be the largest of those discounts to the Market Price which enables the Company to repurchase the amount of capital it determines to buy back.

The ATO has indicated to Rio Tinto that the capital component of the Buy-Back Price will be A$9.44. Rio Tinto expects this to be confirmed in the Class Ruling. For Australian tax purposes, the sale proceeds of the Shares for entities other than companies will generally be taken to be the A$9.44 capital component plus the amount (if any) by which the Tax Value exceeds the Buy-Back Price. The closing date is 9th November 2018, and the date of buy-back contract will be Monday 12th November 2018.

Further information is available www.riotinto.com/rtlbuyback