Rio Tinto is preparing to sell a stake in its Australian infrastructure assets, attracting interest from major private equity firms as it seeks to improve capital efficiency under incoming chief executive Simon Trott. The mining company is opening a data room for potential bidders to review details of the transaction, which involves its integrated iron ore network in the Pilbara region of Western Australia.
Documents related to the sale process were distributed this week, with investment bank Morgan Stanley overseeing the transaction. Four prominent private equity groups—Apollo Global Management, Kohlberg Kravis Roberts (KKR), Brookfield, and Blackstone—are reported to be among the parties showing initial interest. The process is understood to be invitation-only, targeting a select group of around 10 potential buyers.
Rio Tinto’s infrastructure portfolio in the Pilbara includes 18 active mines, four port terminals, and an approximately 2,000-kilometer rail system. The company recently announced its highest half-year iron ore production in the region since 2018, with 137.2 million tonnes produced and underlying earnings before interest, tax, depreciation, and amortization (EBITDA) of about $7 billion.
The expected transaction is anticipated to generate between $2 billion and $3 billion for Rio, following a similar move by its competitor BHP. Last year, BHP agreed to sell a 49 percent stake in its Western Australian iron ore inland power network to Global Infrastructure Partners (GIP) for $2 billion, setting a precedent for such infrastructure selldowns.
Brookfield has previously invested in Australian mining infrastructure, including the Dalrymple Bay Coal Import Terminal, which it acquired before floating as Dalrymple Bay Infrastructure on the Australian Securities Exchange in 2020. Apollo’s involvement is seen as representative of the large pools of capital from insurance and retirement funds that such infrastructure assets attract. Apollo manages assets exceeding $1 trillion, while Blackstone and KKR are also among the largest global infrastructure investors, with assets under management surpassing $1 trillion and $756 billion, respectively.
The sale reflects a broader trend among mining companies to unlock capital through partnerships with infrastructure-focused investors, allowing them to maintain operational control while improving financial flexibility. Rio Tinto’s move is viewed as part of a strategic effort by the new leadership to optimize the company’s balance sheet and investment profile amid strong market conditions for iron ore.