The proposal, aimed at streamlining the company’s corporate governance and unlocking operational efficiencies, garnered 80.65 percent approval in favour but failed to achieve the required 80 percent in both its UK and Australian listings. With 19.35 percent of votes cast against the motion and support hovering near the threshold, the activist opposition reflects ongoing concerns over valuation and governance trends.

Shareholder voting outcome and activist resistance

Under Rio Tinto’s current dual-listing structure, the company operates as two separate legal entities listed in London and Sydney.

The proposal sought to combine both into a single corporate entity with unified shares to enhance competitiveness and reduce compliance costs.

However, while 80.65 percent voted in favour, the plan narrowly missed approval due to institutional investor and activist concerns over minority rights and arbitrage losses.

Market reaction and underlying drivers of dissent

The immediate market reaction saw Rio Tinto Plc shares in London fall by 1.3 percent to £58.70, while Australia-listed shares held steady at AUD 139.90.

Investors questioned the near-term financial rationale and viewed the limited operational impact as insufficient to justify merger costs.

Dual-listed dynamics—tax treatments, currency exposures, and dividend policies—further fuelled resistance among Australian holders and arbitrageurs.

Dual-listing arbitrage dynamics and relative-value trades in mining stocks

Arbitrageurs exploit valuation gaps between the two listings, which would have closed under unification.

BHP’s successful 2022 DLC unification has outperformed Rio Tinto, illustrating the potential benefits of streamlined governance.

These governance disparities create pair-trade opportunities between BHP and Rio Tinto based on relative performance expectations.

Recommendations for pair trades and arbitrage strategies

Rio Tinto dual-listing arbitrage

Monitor the spread between Plc and Limited shares for price inefficiencies.

A narrowing spread may signal sell signals on the higher-priced listing and buys on the lower-priced one.

BHP vs Rio Tinto relative-value trade

Go long BHP shares and short Rio Tinto to capitalise on BHP’s unified model outperformance.

This strategy banks on continued value migration unless Rio Tinto revisits its corporate structure.

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