Rio Tinto sells copper mine interests for $3.5B to Inalum, sending stock higher

Rio Tinto PLC and Freeport-McMoRan Inc. announced Thursday a deal for the sale of Rio Tinto‘s interest in the Grasberg copper mine to Indonesia‘s state mining company, PT Indonesia Asahan Aluminium (Inalum) for $3.5 billion. Rio Tinto‘s U.S.-listed shares rose 1.2% in premarket trade and Freeport‘s stock rallied 1.8%. Freeport currently owns 90.6% of the Grasberg mine and Inalum owns the rest. Rio Tinto currently has the right to 40% of production above an agreed level and 40% of all production after 2022. In 2017, the mine produced 468 kilotons of copper and Rio Tinto‘s share was 5.7 kilotons. Separately, Freeport and Inalum have entered into an agreement in which Inalum will buy an additional stake in the Grasberg mine. Rio Tinto‘s stock has edged up 0.9% year to date through Wednesday and Freeport shares have shed 8.4%, while the S&P 500 has gained 3.8%.