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StumbleuponLONDON - European regulators could threaten to stop the proposed takeover of Rio Tinto by BHP Billiton because of the dominance the pair have over the world's iron ore supply, Britain's Sunday Times newspaper reported.
The report said the warning will come in a long-awaited "statement of objections" from Brussels, which will be crucial in deciding whether the second-largest corporate takeover ever can go ahead.
A merged BHP-Rio would control about a third of the seaborne iron-ore trade, thanks to the pair's huge mines in northwest Australia, which are the main suppliers of iron ore to steel mills across Asia.
BHP, which launched its bid for Rio a year ago, will have four weeks in which to tell the commission how it plans to overcome its objections, the report said.
BHP has offered Rio Tinto shareholders 3.4 of its shares for every one in Rio Tinto. The Rio board has rejected the offer, and refused to enter talks with BHP.
A spokeswoman for Rio Tinto refused to comment on the situation, while a spokesman at BHP was not available for immediate comment.
(Reporting by Rhys Jones; Editing by Jason Neely)
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