Rio Tinto exercised its right to subscribe for and acquire common shares in Ivanhoe Mines Limited under its Subscription Right. As a result, Ivanhoe Mines will issue 27,896,570 million new shares to a wholly owned subsidiary of Rio Tinto, Rio Tinto International Holdings Limited increasing Rio Tinto's ownership in Ivanhoe Mines by 2.0% to a total of 358,158,442 common shares or 48.5%.
The price paid per share was CAD 18.98 and the total consideration for the exercise of this Subscription Right was CAD 529.5 million. The subscription was made in accordance with existing contractual arrangements between Rio Tinto and Ivanhoe Mines that permits share purchases in certain circumstances and subject to certain limits. Under the terms of these agreements and subject to certain exceptions, Rio Tinto's current maximum permitted shareholding in Ivanhoe Mines is 49%.
The subscription was made in order to increase Rio Tinto's ownership of Ivanhoe in accordance with its contractual rights. Depending upon its assessment of Ivanhoe's business, prospects and financial condition, the market for Ivanhoe's securities, general economic and tax conditions and other factors, Rio Tinto will consider availing itself of its rights to acquire additional securities of Ivanhoe.
Today's subscription reinforces Rio Tinto's commitment to the Oyu Tolgoi project, which is a natural fit with its strategy of focusing on cost competitive, long life assets with significant growth potential. Together with Ivanhoe and the Government of Mongolia, Rio Tinto is determined to develop Oyu Tolgoi in a sustainable, mutually beneficial manner for the people of Mongolia.