Tata Steel Ltd. (500470.BY) said Thursday it has decided to sell its entire 26.27% stake in Riversdale Mining Ltd. (RIV.AU) to Rio Tinto Plc (RIO) for about A$1.06 billion (US$1.1 billion).

The Indian steelmaker's decision, announced in a stock exchange filing, comes a day before Rio Tinto's takeover offer for the Africa-focused coal miner expires.

Rio Tinto is looking to delist the Australian company. The London-based mining giant owns 73.42% of Riversdale, leaving the free float of shares at just 0.3% of the total.

Tata Steel said it decided to sell the stake as it didn't want to hold any equity investment in Riversdale without a joint venture agreement with Rio Tinto after Riversdale's potential delisting.

-By Kenan Machado, Dow Jones Newswires; +91 22 6145 6107; kenan.machado@dowjones.com

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