Speculation rife on Rio Tinto’s Turquoise Hill acquisition

Rio Tinto took the reins of Turquoise Hill Resources (TRQ) back in 2011, buying up a controlling stake of 51 per cent. Now the markets are abuzz with speculation about Rio acquiring the other 49 per cent of the company.

The full takeover has been posited by industry analysts since 2011, but now it seems all the more probable thanks to rising copper prices and a stake increase in TRQ of around 6 million share by Rio.

Oyu Tolgai is a colossal asset in Mongolia, one of the world’s most exciting copper, gold and silver mines, and 66 per cent owned by TRQ – meaning that Rio effectively only owns 34 per cent of its metals.

Analysts have commented that it would be the smart move for Rio to acquire the full mine before copper prices rise over the next three years.

Some, though, have noted that the stake increase by Rio could just be linked to a small firm that they and TRQ both own shares in: Entrée Gold.

Entrée owns swathes of land around Oyu Tolgoi and has split into two new companies recently, leading some to believe that this new share offering is what led to Rio’s increased stake in TRQ.

However, with the price of copper going nowhere but up, it is not a case of if Rio will have taken out both Entrée and TRQ by the time Oyu Tolgoi reaches peak production in 2025, but when.