Turquoise Hill owns a 66% interest in the Oyu Tolgoi mine in Mongolia. Credit: Rio Tinto.

Rio Tinto has offered to purchase the remaining stake in Canadian mining firm Turquoise Hill for approximately $2.7bn.

In accordance with the proposal, minority shareholders of Turquoise Hill will receive $26.66 (C$34) in cash from Rio Tinto for each share held in the Canadian company.

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Rio Tinto currently owns a 50.8% stake in the publicly listed Turquoise Hill, which holds a 66% interest in the Oyu Tolgoi copper-gold mine in Mongolia.

The remaining 34% stake in the mine is held by the state-owned Erdenes Oyu Tolgoi.

The offer follows the recently signed agreement by Rio Tinto and Turquoise Hill with the Mongolian Government to proceed with the $6.93bn Oyu Tolgoi underground project.

Rio Tinto expects the proposed transaction to simplify the ownership structure of the Mongolian mine while bolstering its copper portfolio.

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Rio Tinto CEO Jakob Stausholm said: “Rio Tinto strongly believes in the long-term success of Oyu Tolgoi and Mongolia, and delivering for all stakeholders over the long-term.

“That is why we want to increase our interest in Oyu Tolgoi, simplify the ownership structure, and further strengthen Rio Tinto’s copper portfolio. We believe the terms of the proposal are compelling for Turquoise Hill shareholders.”

The proposed deal is planned to be carried out through a Canadian plan of arrangement. It will be subject to customary closing conditions including approval by Turquoise Hill’s minority shareholders.

Last week, Rio Tinto and its partners were ordered by Guinea’s ruling junta to fully suspend activities at the Simandou iron ore project.

Guinea interim President Mamady Doumbouya said it is not clear how the mine would preserve the country’s interests.