A proposed production joint venture in the Pilbara between mining heavyweights BHP Billiton Ltd
(ASX:BHP) and Rio Tinto Ltd
(ASX:RIO) has hit another stumbling block.
Germany has announced it will block the multi billion deal between the two Aussie miners which could mean that European regulators will also move to reject the proposal.
According to Reuters the German Federal Cartel Office says it has decided to prohibit the planned merger of Rio and BHP’s iron ore operations in the Pilbara of Western Australia.
Reuters says EU regulators are concerned that the deal could potentially hurt competition in the industry.
According to a source, Reuters reports that the Commission is expected to issue a statement of objections to the merger of the two companies.
There has been speculation of late that Rio was planning to walk away from the deal, the miner responding saying that while the proposal faces hurdles it is still pursuing the deal.
BHP Billiton earned profit of $15.26 billion for the 2010 financial year.
