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Transaction/Case Details

Rio Tinto completes US$600 million short term credit facility to Turquoise Hill

DATE CLOSED

August 7, 2013

BUSINESS SECTOR

Mining & Metals

LEAD OFFICE

Toronto

VALUE

600 Million USD


OVERVIEW

On August 7, 2013, Turquoise Hill Resources announced that the company had signed an agreement with majority shareholder Rio Tinto for a financing package designed to meet Turquoise Hill's cash needs through the end of 2013. Under the financing package, Rio Tinto agreed to provide Turquoise Hill with a secured US$600 million bridge funding facility maturing on December 31, 2013 (the New Bridge Facility), initially to refinance US$225 million in outstanding short term bridge debt owed to Rio Tinto and thereafter to fund the continued development of phase one of Turquoise Hill’s Oyu Tolgoi copper/gold mine in Mongolia. In addition, if in certain circumstances project financing for the Oyu Tolgoi mine were not available in an amount sufficient to repay to Rio Tinto all amounts outstanding under the New Bridge Facility and an existing US$1.8 billion interim funding facility prior to their maturity on December 31, 2013, Turquoise Hill agreed that it would conduct a rights offering to raise sufficient funds to make such repayments (and fund certain other payments), and Rio Tinto agreed, subject to certain terms and conditions, to provide a standby commitment for the full amount of the rights offering to the extent rights were not exercised by other holders.

Rio Tinto, headquartered in London, United Kingdom, is a multinational metals and mining corporation.

Turquoise Hill, headquartered in British Columbia, Canada, is a mineral exploration and development company.

McCarthy Tétrault LLP represented Rio Tinto, the lender.

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