Rio Tinto to Buy Back Even More Shares After Coal-Mine SaleBy
Miner will increase its buyback amount by $2.5 billion
Company says total buybacks this year will be $4 billion
Rio Tinto Group, fresh from paying a record interim dividend, will buy back another $2.5 billion of its shares using proceeds from the sale of its Australian coal assets.
Rio will buy about $560 million of Rio Tinto Ltd. shares, with the remaining $1.9 billion being used to expand its existing on-market buyback of Rio Tinto Plc shares, the company said in a statement Thursday.
Rio Tinto is channeling more money back to shareholders after the mining industry staged a dramatic comeback following a 2015 collapse in commodity prices. With the industry still reluctant to spend a lot of money on new mines or deals, dividends and stock buybacks are becoming popular. Last month, the company increased its share buyback by $1 billion this year and said it will pay a $2 billion interim dividend.
Rio latest announcement takes its total share buyback this year to $4 billion. The company agreed to sell its Coal & Allied coal operations in the Hunter Valley to China-backed Yancoal Australia Ltd. earlier this year for $2.69 billion.