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Rio Tinto and Yancoal advised on multibillion-dollar deal

Rio Tinto and Yancoal advised on multibillion-dollar deal

Deal, handshake

Rio Tinto has sold Coal & Allied Industries to Yancoal Australia, with a multibillion-dollar price tag. 

Firms: Allens (Rio Tinto); Herbert Smith Freehills (Yancoal Australia)

Deal: Yancoal Australia acquired Coal & Allied Industries from Rio Tinto.

Value: US$2.69 billion

Area: M&A

Key players: The Allens team advising Rio Tinto was led by partner Richard Malcolmson, supported by partners Richard Kriedemann, Ted Hill, Malcolm Stephens and Michael Ilott, special counsel Glenys Hodges, mergers and acquisitions counsel Andrew Wong, managing associate Steven Local, senior associate Tracey Davern, associates Sophie Matthiesson and Melanie Hayden, lawyers Maggie Shelton and Isabel Burraston, applied legal technology senior consultant Pavel Zorin and project analyst Richard Tomat.

Deal significance: Rio Tinto sold Australian subsidiary Coal & Allied Industries to Yancoal Australia as the final deal in a series of thermal coal divestments in the NSW Hunter Valley region.

The US$2.69 billion sale price comprises US$2.45 billion in cash and US$240 million in unconditional guaranteed royalty payments. In addition, Rio Tinto may receive additional royalties linked to the coal price, capped at US$410 million.

“We are very pleased to have assisted Rio Tinto with this significant transaction and its other recent thermal coal divestments,” said Allens lead partner Richard Malcolmson.

“Together with our roles advising Rio Tinto on the sale of its interests in the Clermont coal mine and the Northparkes copper-gold mine, Allens has acted for the group on more than US$5 billion of divestments since 2013.

“We are very proud of our long history with Rio Tinto, and delighted to have assisted with the success of these substantial transactions.”

The deal was completed on 1 September.


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