CA - Turquoise Hill gains after Rio Tinto reaches agreement with some larger holders

Turquoise Hill Resources ( NYSE: TRQ ) rose 4.7% in after hours trading after Rio Tinto ( NYSE: RIO ) reached an agreement with some shareholders who had publicly opposed the C$43/share sale agreed

Pentwater Capital, the largest holder after Rio Tinto, and SailingStone Capital, agreed to withhold their votes at the holder meeting next Tuesday, according to a statement . The investors will withhold their votes and exercise their dissent rights. Rio Tinto agreed to increased the consent condition to 17.5% from 12.5% of Turquoise Hill shares outstanding.

The news comes after Turquoise Hill's shareholder vote on the sale to Rio Tinto ( RIO ) was postponed a week from earlier Tuesday. The postponement came after Pentwater Capital had been publicly opposed to the deal for Turquoise Hill ( TRQ ) even as Rio Tinto has said it won't raise its bid for the miner.

Under the terms of the agreement with Pentwater and SailingStone, the parties agreed that the dissent proceedings will be conducted by arbitration and the holders will be paid C$34.40 of the consideration following completion of the deal and the remainder following final determination of the arbitration.

In September, Rio Tinto ( RIO ) offered to acquire the ~49% of Turquoise Hill ( TRQ ) shares that Rio and its affiliates do not already own for C$43/share. Rio Tinto reconfirmed in the Tuesday statement that the proposal of C$43.00 offer was its best and final.

Last month influential proxy adviser ISS said Turquoise Hill ( TRQ ) holders should vote to reject the deal as takeover offer undervalues the company. The recommendation came after rival proxy adviser Glass Lewis said holders should vote in favor of the deal.

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