Rio Tinto, the 49 percent stakeholder in Ivanhoe Mines, was successful in its arbitration challenge against provisions of a poison pill defense adopted by Ivanhoe Mines Ltd. aimed at preventing an unwanted takeover. The news comes shortly after Peter Meredith, Ivanhoe Deputy Chairman, said a ruling would soon come at the Mongolia Investment Summit in London, an event at which Meredith was introduced by Jim Dwyer, Executive Director of BCM.

Rio Tinto PLC said Tuesday it reserves the right to increase its stake in Canadian mining concern Ivanhoe Mines Ltd., but doesn't have plans to make a full takeover offer after winning an arbitration process involving Ivanhoe's shareholder-rights plan.

The Anglo-Australian miner has been successful in its challenge to protect its rights against a poison-pill defense adopted by Ivanhoe; Rio will be able to maintain its 49% stake if any bid for Ivanhoe triggers the smaller company's shareholder-rights plan adopted last year, Ivanhoe said in a statement Tuesday. The decision by the arbitrator also frees Rio to increase its stake beyond the 49% cap agreed between the companies under a five-year-old pact due to expire Jan. 18, something many analysts have said is likely at some point.

Depending on the evaluation of a series of factors, "Rio Tinto may seek opportunities to increase its shareholding in Ivanhoe to a majority position but currently has no intention of making a full takeover bid for Ivanhoe's shares," Rio said in a statement. However, it said it reserves the right to change its intention in the future.

Ivanhoe announced after the close of markets Monday that the decision by the arbitrator involved two aspects    of the shareholders rights agreement adopted by the Vancouver-based miner in October 2010. One of the rulings held that anti-dilution rights granted to Rio in a private placement agreement with Ivanhoe in 2006 would continue to apply even if Rio triggered the rights plan by becoming an “acquiring person.” The arbitrator's decision also addressed the counterclaim that Ivanhoe filed against Rio Tinto alleging it has acted in breach of certain of its obligations under the private placement agreement.

“The arbitrator determined that Rio Tinto had not breached such obligations,” said Ivanhoe in a release. "We will continue to strive to ensure that all Ivanhoe shareholders are treated fairly," said David Huberman, chairman of Ivanhoe.

Rio initiated the arbitration proceeding after claiming the adoption of the poison pill breached a joint-venture agreement to develop the Oyu Tolgoi project. Ivanhoe, a 66 percent stakeholder in the Oyu Tolgoi copper and gold project, has spent almost the entirety of 2011 keeping Rio at bay from a majority takeover. Last week Rio and Ivanhoe reached an agreement that will see the international mining giant provide billions of dollars in financing and assume management of Oyu Tolgoi.

Rio has committed to invest roughly USD 1.3 billion in Ivanhoe in coming months through a rights offering and the exercise of warrants as well as agreed to provide up to USD 1.8 billion in interim financing. The company also has the potential to invest hundreds of millions more in Ivanhoe if it decides to exercise various rights over the next few years.