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Palliser urges Rio Tinto to pursue unification of dual-listed structure

10th March 2025

By: Reuters

  

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London-based hedge fund Palliser Capital released on Monday a letter addressed to the chair of global iron-ore miner Rio Tinto, urging further steps toward unifying its dual-listed structure following an appraisal report.

The letter highlighted the findings of an appraisal report by Grant Thornton Australia, which identified a share price disparity between the UK and Australian listings.

The report noted that this differential limits Rio Tinto's ability to execute major stock-based mergers and acquisitions and complicates equity capital raising.

Rio Tinto currently operates with a dual-listed structure, maintaining separate shareholder bases in the UK (Public Limited Company) and Australia (Limited). As a result, the company is required to hold two annual general meetings: one in London on April 3 and another in Perth on May 1.

The upcoming votes at Rio Tinto's annual general meetings will be crucial in determining the future direction of the company's listing structure.

At these meetings, shareholders will vote on a resolution proposed by Palliser Capital and more than 100 shareholders, urging a review of the current structure, which the fund has described as inefficient and "value destructive."

Since adopting the dual-listed structure in 1995, Rio Tinto has not used shares as scrip for any of its approximately $55-billion in acquisitions, according to the report. It also suggested that unification could enhance dividend franking capabilities within the company's payout targets.

The company's current listing consists of approximately 371.2-million shares on the Australia Stock Exchange and 1.25-billion shares on the London Stock Exchange.

This move follows similar actions by larger rival BHP Group BHP.AX, which, after facing pressure from activist investors, eliminated its dual-listing structure in 2022 and now primarily lists in Australia.

Edited by Reuters

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