Miner Rio Tinto receives offer for talc division from Imerys

LONDON: Global mining giant Rio Tinto said Wednesday that it has received an offer for its talc business, Luzenac, from French industrial minerals group Imerys.

"Rio Tinto has received a binding offer from Imerys to acquire its talc business for an enterprise value of US$340 million (248 million euros)," the British-based resources company said in a statement.

"A period of exclusivity with Imerys has been agreed, and Rio Tinto will respond to this binding offer following consultation with the relevant European works councils."

Luzenac is the world's biggest producer of talc, a mineral used in a vast array of products, including animal feed, cosmetics, fertilizers, paints, pharmaceuticals, plastics, roofing and talcum powder.

Rio's talc unit has around 1,000 employees at 24 locations across Europe, North America, Australia and Asia.

"The successful sale of our global talc business would deliver good value to our shareholders and remains aligned with our strategic focus on large scale assets," said Rio's chief financial officer Guy Elliott in the statement.

"As a leading supplier of industrial minerals, Imerys is well positioned to enable the ongoing success of the talc business."

The Anglo-Australian group added that it raised more than US$11 billion since 2008, with the completion of more than 18 asset sales.

Last week, Rio revealed that annual net profits almost tripled on the back of booming commodities prices and rapid growth in emerging markets.

Earnings after tax rocketed to $14.32 billion (10.50 billion euros) last year, compared with $4.87 billion in 2009.

Equities analyst Richard Hunter, at Hargreaves Lansdown stockbrokers, said the talc sale was in line with the group's strategy to focus on more profitable areas like coal, copper and iron ore.

"It appears to be an ongoing part of Rio's strategy to divest smaller units in order to be able to concentrate on its larger scale and more profitable operations," he told.

Copyright AFP (Agence France-Presse), 2011