Rio Tinto plc Sponsored ADR (RIO.US) issued $9 billion investment-grade bonds to provide funding support for the acquisition of Arcadium Lithium.

On Tuesday, mining giant Rio Tinto plc Sponsored ADR (RIO.US) issued $9 billion in investment-grade bonds to provide funding support for its acquisition of Arcadium Lithium. The bond issuance attracted over $50 billion in investor subscriptions, indicating a high level of market approval for Rio Tinto plc Sponsored ADR's financing activities. According to sources, Rio Tinto plc Sponsored ADR sold eight types of corporate bonds with maturity dates, with a 40-year bond yielding 1.33 percentage points higher than comparable U.S. Treasury bonds. Recently, Rio Tinto plc Sponsored ADR officially announced the completion of the acquisition of Arcadium Lithium, with the transaction amount reaching $6.7 billion. Last week, there were reports that Rio Tinto plc Sponsored ADR had considered selling up to $5 billion worth of equity to help pay for the acquisition costs, but later abandoned this plan. It is reported that back on October 9, 2024, Rio Tinto plc Sponsored ADR reached an agreement to acquire Arcadium Lithium, planning to acquire it through an all-cash transaction at a price of $5.85 per share. This acquisition offer represents a staggering 90% premium over Arcadium Lithium's closing price of $3.08 per share on October 4, demonstrating Rio Tinto plc Sponsored ADR's determination to acquire and high recognition of the value of Arcadium Lithium's assets. This transaction signifies a crucial strategic step for Rio Tinto plc Sponsored ADR in the lithium business layout. Arcadium Lithium will be renamed Rio Tinto plc Sponsored ADR Lithium, and will integrate with Rio Tinto plc Sponsored ADR's Rincon lithium project. Rio Tinto plc Sponsored ADR has also officially become the world's third-largest lithium producer, only behind Albemarle Corporation (ALB.US) and Sociedad Qumica y Minera de Chile (SQM.US). According to the previously disclosed agreement, Rio Tinto plc Sponsored ADR will gain access to Arcadium Lithium's lithium mines, processing facilities, and deposits in Argentina, Australia, Canada, and the United States, as well as customers including Tesla, Inc., BMW, and General Motors Company. Rio Tinto plc Sponsored ADR Lithium plans to increase the annual production capacity of its primary assets to over 200,000 tons of lithium carbonate equivalent (LCE) by 2028, equivalent to 15% of global lithium supply in 2023. Royal Bank of Canada estimates that after the acquisition is completed, the lithium business will account for around 4% of Rio Tinto plc Sponsored ADR's profits by 2028. Rio Tinto plc Sponsored ADR also stated that, benefiting from the current robust development of the global new energy industry, the continuous increase in lithium market demand, and accelerated capacity expansion, the company's EBITDA and operating cash flow are expected to achieve significant growth in the coming years.