Rio Tinto To Provide $600 Mln Bridge Funding Facility To Turquoise Hill

(RTTNews) - Rio Tinto Plc. (RTPPF.PK, RIO.L, RIO, RTNTF.PK) said it has signed an agreement with Turquoise Hill Resources under which Rio would provide a $600 million bridge funding facility to Turquoise Hill, maturing December 31, subject to certain conditions.

The financing package is to enable Turquoise Hill to fund the continuing development of the Oyu Tolgoi mine in Mongolia. The package will also be used, if necessary, to refinance its existing debt to Rio by the end of the year.

The facility will be used initially to refinance all amounts outstanding under an existing $225 million short term funding facility provided by Rio in June, and thereafter for the continued ramp up of phase one of the Oyu Tolgoi mine development.

Rio has agreed to extend the short term funding facility until August 28 and to permit funds repaid by Turquoise Hill from the proceeds of the sale of its 50 percent interest in Altynalmas Gold Ltd. to be redrawn.

Rio has also also agreed to waive its option to convert all or part of any amounts outstanding under the short term funding facility into TRQ common shares.

In addition, if Turquoise Hill is required to raise equity to repay this new bridge facility and the existing $1.8 billion interim funding facility provided by Rio, which also matures on December 31, Rio has agreed to provide a firm stand-by commitment for a fully underwritten rights offering by Turquoise Hill.