BHP Billiton and Rio Tinto
BHP Billiton (ASX:BHP) may have to pay as much as $4 billion more in their joint venture with Rio Tinto (ASX:RIO) then originally planned, based on the iron ore assets Rio will add to the venture.
The reason for the major increase in price is iron ore prices are estimated to rise at levels which would warrant the higher price.
That would bring the total investment to between $7.5 billion to $9.8 billion, an increase of almost 70 percent over the equalization payment agreed to at the beginning of the deal.
The purpose of the joint venture is to combine a variety of resources to save a minimum of $10 billion for the companies. The deal still has to be approved by regulators before going forward.
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