Recent Blog Posts
-
The Times' Rorshach Geithner Story
Apr 27 20099:04am EDT -
Sinking Animal Spirits
Apr 27 20098:04am EDT -
Counter-cyclical Urban Policy
Apr 26 200910:04am EDT -
Be Your Own Counterfeiter
Apr 26 20099:04am EDT -
Being Tim Geithner
Apr 25 200912:04pm EDT -
Notes From a Press Conference Naif
Apr 25 20099:04am EDT -
What Good is the News?
Apr 25 20098:04am EDT -
Stressful Enough
Apr 24 20092:04pm EDT -
Not Regretting the Pound
Apr 24 20091:04pm EDT -
Introducing the New Ford Squeeze
Apr 24 20099:04am EDT -
Non-Economic Questions of the Day
Apr 24 20099:04am EDT -
The Stress Test Blind Alley
Apr 24 20098:04am EDT -
Happy Hour
Apr 23 20099:04pm EDT -
Recovery Without Rebalancing
Apr 23 20096:04pm EDT -
The Shape of Your Recession
Apr 23 20095:04pm EDT
Links
- Felix Salmon
- DealBreaker
- Ryan Avent: The Bellows
- The Epicurean Dealmaker
- Chris Anderson
- Ultimi Barbarorum
- MarketBeat
- Michelle Leder
- John Quiggin
- The Panelist
- Andrew Leonard
- Streetsblog
- Brad Setser
- Michael Mandel
- Financial Crookery
- Kash Mansori
- Dean Baker
- Calculated Risk
- Free Exchange
- Curbed
- Lance Knobel
- Econospeak
- Carbon Tax Center
- Overcoming Bias
- Mark Thoma
- Naked Capitalism
- Alphaville
- Barry Ritholtz
- Alexander Campbell
- The Bayesian Heresy
- Brad DeLong
- DealBook
- Greg Mankiw
- Deal Journal
- FP Passport
- Carl Bialik
- Marginal Revolution
- A Fistful of Euros
- Dan Gross
A Chinese Bid for Rio Tinto?
It makes sense all the sense in the world that China, broadly defined, should make a bid for Rio Tinto. If it doesn't, there's a very good chance that the BHP-Rio merger will go through – a merger which would be unambiguously bad for Chinese iron-ore importers. Given that China's sovereign-wealth fund seems unlikely to make a bid, a strategic bid from China's private sector has to be a strong possibility.
Bloomberg's Helen Yuan says that a number of Chinese steelmakers are interested, although one in particular, Shougang, has repudiated the story. And a Reuters report saying that Baosteel might pay as much as $200 billion for Rio Tinto has been "taken with a grain of rice," according to the WSJ's Chris Kaufman.
I can't remember any Chinese company getting into a bidding war in the international M&A arena, but it's inevitable that sooner or later that will happen. And Rio Tinto is a big enough prize that it might just be the company to make such an aggressive bid worthwhile.
One big unknown: How the new left-leaning Australian government would react to such a bid. The new prime minister, Kevin Rudd, is famously fluent in Mandarin. But that doesn't make him more or less likely to object to a Chinese takeover of a large swathe of Australia's natural resources.
