Some real shit stirring here from Bloomie:
Rio Tinto may decide that its best defense against another takeover approach from Glencore is buying the largest mining company in the US.
A bid for Freeport-McMoRan will probably look tempting to Rio as a way to stymie Glencore, said Paul Gait, an analyst at Sanford C. Bernstein. Freeport, a $US32 billion ($36.5 billion) copper producer that expanded into energy last year, is the cheapest it’s been in more than 15 months relative to operating earnings.
“I would be amazed if they aren’t running the ruler over it,” Gait said in a phone interview from London. “It would be a classic kind of defensive move by the board.”
…”Freeport fits all the criteria of an attractive takeout candidate and would make sense for a lot of the larger-cap global miners, anyone looking to increase their copper exposure and getting some very high-margin energy assets at the same time,” said Garrett Nelson, analyst at BB&T Capital Markets in Richmond, Virginia. “The stock’s undervalued and they really have some world-class assets in both mining and energy.”
Does anyone remember RIO’s last a defense against takeover called Alcan when BHP came calling? It hobbled its balance sheet for the last decade. Paul Gait was also behind yesterday’s Chanitcleer piece cheer-leading the Glencore merger. Wonder what he’s up to then?
