Glencore makes late bid for Australian coal mines

Glencore Plc's last-minute bid for Australian coal mines leaves Rio Tinto Group with a dilemma to mull over the weekend: accept less money or risk upsetting its biggest customer.

On Friday afternoon in London, Glencore raised its bid for the mines, offering at least $225 million more than a proposal from China's Yanzhou Coal Mining Co, which Rio has already backed. Glencore added new incentives, promising a hefty deposit and compensation for regulatory delays, and countered concerns about funding.

Rio plans to review Glencore’s updated bid and provide an update before the shareholder meeting on Tuesday. If it decides the offer is superior, it will postpone the meeting and give Yancoal time to respond, the company said.

In the new bid, Glencore promised to pay a $225 million deposit, which would be forfeited if the deal doesn’t win regulatory approval. Glencore would compensate Rio if the deal is delayed, either by paying $25 million a month or cash flow from the mines after September.