Rio Tinto dismisses proxy advisers’ support for | Australian Markets

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Rio Tinto has dismissed assist for a review of its company construction from two influential shareholder advisers, defending its UK itemizing in opposition to strain from an activist investor.

The Anglo-Australian mining group includes individually listed firms in London and Sydney however has been underneath strain to merge its listings on the Australian stock exchange, the place mining firms have traded at a premium to London lately.

Such a transfer would additional diminish the London Inventory Trade’s standing as a home for mining shares. BHP, Rio’s bigger rival, took a related step in 2022.

Proxy adviser Institutional Shareholder Companies stated on Tuesday that it supported a movement from activist traders led by Palliser Capital for Rio to launch a new review of its share construction.

The movement to Rio’s twin annual conferences in April and Might asks the miner to type a committee of impartial administrators, with an exterior shareholder in attendance, to review whether or not it ought to redomicile its itemizing into a unified Australian company.

Glass Lewis, one other proxy adviser, additionally supported the Palliser movement final week.

Rio stated on Wednesday that its board unanimously beneficial shareholders vote in opposition to the movement.

The miner stated it had already performed a review and opted in opposition to the transfer, arguing it will destroy shareholder worth by producing billions of {dollars} in tax losses.

Rio has argued it will be unlikely to gain the required investor assist since more than two-thirds of its shareholders maintain the UK-listed stock.

It added that the worth of its Australia-listed shares can be more likely to drop by more than 10 per cent if mixed with the lower-value UK stock.

The company additionally rejected the notion that a unified construction would give it more “hypothetical flexibility” for dealmaking.

Rio stated senior executives had met Palliser seven instances since 2024 in addition to a “broad range of shareholders” to debate its own “robust and comprehensive” review of a potential consolidation of its construction.