RTZ establishes pounds 13bn Australian connection

MAGNUS GRIMOND

and agencies

RTZ moved yesterday to cement its position as the world's biggest mining group with a pounds 13bn merger with CRA, its Australian associate. Robert Wilson, RTZ chief executive, is to be full-time chairman of the new group when Sir Derek Birkin leaves the British group in December 1996.

The merger, which will be effective from January if all approvals are received, is to be achieved by establishing a dual listed companies structure, without transferring assets, to create a dual-nationality group similar to Royal Dutch-Shell or Unilever. Sir Derek said: "It further reinforces our competitive advantages at a time when new prospects are opening up worldwide ... " He ruled out any offer for the 51 per cent of shares not held by RTZ.

Both companies will retain national identities and separate shareholders, but management and boards are to be combined, with CRA chief executive Leon Davis becoming chief executive of the combined group.

The new RTZ-CRA will have assets of pounds 4.5bn, operations spanning the globe and a market capitalisation of around pounds 13bn. RTZ is the world's largest miner and the major world producer of copper and gold. CRA is a major world producer of iron ore, aluminium and coal, and has significant interests in diamonds and gold.

An independent report on the merger will be sent to CRA shareholders in about six weeks. Existing RTZ shareholders will end up with an effective 76.5 per cent interest in the new group.