BHP Group Limited — M&A Activity 2008

Feb 5, 2008

BHP Billiton Offer for Rio Tinto 6 February 2008 Marius Kloppers Chief Executive Officer

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Disclaimer

This document has been prepared by BHP Billiton Ltd and BHP Billiton Plc (“ BHP Billiton") and comprises the written materials/slides for a presentation concerning BHP Billiton's offer for Rio Tinto Ltd and Rio Tinto plc (“ Rio Tinto” ). By reviewing/attending this presentation you agree to be bound by the following conditions.

The directors of BHP Billiton accept responsibility for the information contained in this presentation. Having taken all reasonable care to ensure that such is the case, the information contained in this presentation is, to the best of the knowledge and belief of the directors of BHP Billiton, in accordance with the facts and contains no omission likely to affect its import.

Subject to the above, neither BHP Billiton nor any of its directors, officers, employees or advisers nor any other person makes any representation or warranty, ex press or implied, as to, and accordingly no reliance should be placed on, the fairness, accuracy or completeness of the information contained in the presentation or of the views given or implied. To the extent permitted by law, neither BHP Billiton nor any of its directors, officers, employees or advisers nor any other person shall have any liability whatsoever for any errors or omissions or any loss howsoever arising, directly or indirectly, from any use of this information or its contents or otherwise arising in connection therewith.

This presentation is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sell or otherwise dispose of, or issue, or any solicitation of any offer to sell or otherwise dispose of, purchase or subscribe for, any securities, nor does it constitute investment advice, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision, nor does it constitute a proposal to make a takeover bid or the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction (or under an exemption from such requirements). No offering of securities shall be made into the United States except pursuant to registration under the US Securities Act of 1933, as amended, or an exemption therefrom.

Neither this presentation nor any copy of it may be taken or transmitted or distributed or redistributed (directly or indirectly) in Japan. The distribution of this document in other jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions.

This presentation is directed only at persons who (i) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order" ) or (ii) have professional experience in matters relating to investments falling within Article 19(5) of the Order or (iii) are outside the United Kingdom (all such persons being referred to as "relevant persons"). This presentation must not be acted on or relied on by persons who are not relevant persons. Information about Rio Tinto is based on public information which has not been independently verified.

Certain statements in this presentation are forward-looking statements. The forward-looking statements include statements regarding contribution synergies, future cost savings, the cost and timing of development projects, future production volumes, increases in production and infrastructure capacity, the identification of additional mineral Reserves and Resources and project lives and, without limitation, other statements typically containing words such as "intends", "expects", "anticipates", "targets", "plans", "estimates" and words of similar import. These forward-looking statements speak only as at the date of this presentation. These statements are based on current expectations and beliefs and, by their nature, are subject to a number of known and unknown risks and uncertainties that could cause actual results, performance and achievements to differ materially from any expected future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements are based on numerous assumptions regarding BHP Billiton's present and future business strategies and the environments in which BHP Billiton and Rio Tinto will operate in the future and such assumptions may or may not prove to be correct.

There are a number of factors that could cause actual results or performance to differ materially from those expressed or implied in the forward-looking statements. Factors that could cause actual results or performance to differ materially from those described in the forward-looking statements include, but are not limited to, BHP Billiton's ability to successfully combine the businesses of BHP Billiton and Rio Tinto and to realise expected synergies from that combination, the presence of a competitive proposal in relation to Rio Tinto, satisfaction of any conditions to any proposed transaction, including the receipt of required regulatory and anti-trust approvals, Rio Tinto’swillingness to enter into any proposed transaction, the successful completion of any transaction, as well as additional factors such as changes in global, political, economic, business, competitive, market or regulatory forces, future exchange and interest rates, changes in tax rates, future business combinations or dispositions and the outcome of litigation and government actions. Additional risks and factors that could cause BHP Billiton results to differ materially from those described in the forward-looking statements can be found in BHP Billiton's filings with the US Securities and Exchange Commission ("SEC"), including BHP Billiton's Annual Report

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Disclaimer (continued)

None of the statements concerning expected cost savings, revenue benefits (and resulting incremental EBITDA) and EPS accretion in this presentation should be interpreted to mean that the future earnings per share of the enlarged BHP Billiton group for current and future financial years will necessarily match or exceed the historical or published earnings per share of BHP Billiton, and the actual estimated cost savings and revenue benefits (and resulting EBITDA enhancement) may be materially greater or less than estimated.

Information Relating to the US Offer for Rio Tinto plc

BHP Billiton plans to register the offer and sale of securities it would issue to Rio Tinto plc US shareholders and Rio Tinto plc ADS holders by filing with the SEC a Registration Statement (the “ Registration Statement” ), which will contain a prospectus (“ Prospectus” ), as well as other relevant materials. No such materials have yet been filed. This communication is not a substitute for any Registration Statement or Prospectus that BHP Billiton may file with the SEC.

U.S. INVESTORS AND U.S. HOLDERS OF RIO TINTO PLC SECURITIES AND ALL HOLDERS OF RIO TINTO PLC ADSs ARE URGED TO READ ANY REGISTRATION STATEMENT, PROSPECTUS AND ANY OTHER DOCUMENTS MADE AVAILABLE TO THEM AND/OR FILED WITH THE SEC REGARDING THE POTENTIAL TRANSACTION, AS WELL AS ANY AMENDMENTS AND SUPPLEMENTS TO THOSE DOCUMENTS, WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

Investors and security holders will be able to obtain a free copy of the Registration Statement and the Prospectus as well as other relevant documents filed with the SEC at the SEC's website (http://www.sec.gov), once such documents are filed with the SEC. Copies of such documents may also be obtained from BHP Billiton without charge, once they are filed with the SEC. Information for US Holders of Rio Tinto Ltd Shares

BHP Billiton Ltd is not required to, and does not plan to, prepare and file with the SEC a registration statement in respect of the Rio Tinto Ltd Offer. Accordingly, Rio Tinto Ltd shareholders should carefully consider the following:

The Rio Tinto Ltd Offer will be an exchange offer made for the securities of a foreign company. Such offer is subject to disclosure requirements of a foreign country that are different from those of the United States. Financial statements included in the document will be prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

Information Relating to the US Offer for Rio Tinto plc and the Rio Tinto Ltd Offer for Rio Tinto shareholders located in the US

It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in a foreign country, and some or all of their officers and directors may be residents of foreign countries. You may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the U.S. securities laws. It may be difficult to compel a foreign company and its affiliates to subject themselves to a U.S. court's judgement.

You should be aware that BHP Billiton may purchase securities of either Rio Tinto plc or Rio Tinto Ltd otherwise than under the exchange offer, such as in open market or privately negotiated purchases.

References in this presentation to “ $” are to United States dollars unless otherwise specified.

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Background to the offer

• Early 2007: BHP Billiton discussed a merger of equals. This concept was rejected by Rio Tinto

• 1 November 2007: BHP Billiton made a confidential proposal to combine the companies. Rio Tinto rejected the proposal and refused to enter discussions

• 8 November 2007: BHP Billiton confirmed it had approached Rio Tinto with a proposal

• 12 November 2007: BHP Billiton announced the proposal following market speculation. Since then:

• Global roadshow has indicated a clear understanding of the industrial logic of the combination

• Rio Tinto has refused to engage to discuss the proposal

• 21 December 2007: BHP Billiton required to “put up or shut up” by 6 February 2008

• 1 February 2008: Chinalco acquires a c.12% stake in Rio Tinto plc

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BHP Billiton offer for Rio Tinto

Rio Tinto plc Offer:

• Rio Tinto plc shareholders will receive 3.4 BHP Billiton shares for every Rio Tinto plc share held – 80% in BHP Billiton Plc shares With a “mix and match” facility

• 20% in BHP Billiton Ltd shares

• Separate US offer (which forms part of the Rio Tinto plc Offer) to: – US resident shareholders of Rio Tinto plc shares

• All holders of Rio Tinto plc ADRs

• UK CGT rollover relief expected to be available for UK resident shareholders accepting the Rio Tinto plc Offer if there are approximately 70% acceptances under the Rio Tinto plc Offer

Rio Tinto Ltd Offer:

• Rio Tinto Ltd shareholders will receive 3.4 BHP Billiton Ltd shares for every Rio Tinto Ltd share held

• If compulsory acquisition is reached in the Rio Tinto Ltd Offer, then Australian CGT rollover relief

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BHP Billiton offer for Rio Tinto

• Offers are inter-conditional

• Subject to pre-conditions relating to certain anti-trust clearances in the EU, the US, Australia, Canada and South Africa and FIRB approval in Australia

• Conditional on more than 50% acceptances in respect of publicly-held shares

• Subject to BHP Billiton shareholder approval and other terms and conditions set out in the offer announcement

• Maintenance of BHP Billiton’s progressive dividend policy

• Proposed initial share buyback of up to US$30bn following completion if the offer is successful[(a) ]

• Buyback and any refinancing of Rio Tinto’s borrowings to be funded through a combination of a US$55bn committed bank financing facility, cash flow from operations, asset disposal proceeds and, if required, debt financing

• Target single A credit rating

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Unlocking value – Why a combination with Rio Tinto?

• Combined entity will have a unique portfolio of tier 1 assets

• Enhanced ability to optimise and high-grade portfolio

• Greater diversity and reduced value at risk

• Combination makes sense in both a rising and a falling market

• Uniquely positioned to meet the growing demands of the global economy – largely driven by China growth

• Expected material quantifiable synergies and financial benefits unique to this combination[(a)]

• US$1.7bn nominal per annum from cost savings

• US$2.0bn additional nominal per annum primarily from volume acceleration

• Other combination benefits

• Broader stakeholders will benefit

• Customers – more product, more quickly and more efficiently

• Communities, employees and developing countries

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Pre-approach the fair value share exchange ratio was 2.4:1

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Exchange ratio
Rio Tinto Rumours of Rio Tinto Rio Tinto offer BHP Billiton confirms
2006 results offer for Alcan for Alcan approach to Rio Tinto Board
3.5x
3.4
3.3x
Rumours of a Rio Tinto
3.1x potential BHP Billiton bid 1H 2007 Results
2.9x BHP Billiton
2007 Results
2.7x
2.5x
2.4
2.3x
2.1x
1.9x
1-Jan-07 4-Mar-07 5-May-07 6-Jul-07 6-Sep-07 7-Nov-07
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Change in Rio Tinto market capitalisation relative to index Change in Rio Tinto market capitalisation relative to index[(a)(b)] (US$bn)

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60
8-Nov:
26-Nov: 12-Dec: 15-Jan:
BHP Billiton
Rio Tinto Investor BHP Billiton Investor Day one of Rio Tinto
confirms approach
50 Presentation Presentation Pilbara media visit
to Rio Tinto
Change in Rio Tinto
40
market cap
30
20
10
0
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31-Jan-08
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The background to our offer

• All share consideration – relative value matters, not absolute value

• BHP Billiton has outperformed Rio Tinto based on total shareholder return since the establishment of the BHP Billiton DLC

• Prior to BHP Billiton’s approach on 1 November 2007 we believe Rio Tinto was fairly valued by the market relative to BHP Billiton

• A responsible offer

• Compelling offer for Rio Tinto shareholders

• Delivering value to BHP Billiton shareholders

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3.4:1 is a compelling value uplift for Rio Tinto shareholders

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Relative market capitalisation [(a)]
• SER = 3.4:1 up from 2.4:1 [(a)] 46%
•
44% of the combined company, up
4 4%
from 36% [(a)] 44%
•
We believe that in the absence of our
42%
offer this value uplift is simply not
available to Rio Tinto shareholders on
a standalone basis 40%
38%
36%
36%
34%
11-Jul-07 8-Aug-07 5-Sep-07 3-Oct-07 31-Oct-07
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3.4:1 is a compelling value uplift for Rio Tinto shareholders

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Precedent mega cap resources all stock transactions
•
45% premium to the combined (Premium, %) [(c)]
volume weighted average market 45%
capitalisation [(a)]
–
21% premium to the combined 32%
30%
market capitalisation based on
28%
closing share prices on Median: 27%(d) 25% 27%
4 February 2008 [(b)]
•
We believe that in the absence of our
offer this value uplift is simply not 10%
available to Rio Tinto shareholders
5%
on a standalone basis
RTZ/ CRA BP/ BP/
BHP/ Billiton ARCO Exxon/ Mobil Amoco
Texaco
Chevron/
TotalFina/ Rio Tinto
Elf Aquitaine BHP Billiton/
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Source: SDC, company fi lings and press arti cles.

Transaction is value enhancing for BHP Billiton shareholders

• Pro-rata exposure to post combination synergies

– Quantified incremental EBITDA expected to grow to estimated US$3.7bn[(a)] per annum

• Strengthened asset portfolio and future growth and growth options

• Cash flow per share accretive from the first full fiscal year following completion[(b)]

• Earnings per share accretive from the first full fiscal year following completion[(c)]

• Opportunity to participate in the proposed initial share buyback of up to US$30bn[(d)]

• Progressive dividend policy to be maintained

• Benefits only achievable by this combination

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Regulatory approvals

• Posting of offer documentation is subject to pre-conditions relating to certain anti-trust clearances in the EU, the US, Australia, Canada and South Africa and FIRB approval in Australia

• Necessary regulatory reviews expected to be completed during the second half of 2008

• Pre-notification discussions are in progress with the European Commission

• Formal notification expected to be filed with the European Commission in the first quarter of 2008

• Transaction timetable incorporates scope for EU merger control process to involve Phase II investigation completing in the second half of 2008

• Preliminary contacts made with relevant anti-trust authorities in the US, Australia, Canada and South Africa and formal notifications will be filed in those jurisdictions in due course

• Following detailed analysis, BHP Billiton believes regulatory concerns can be addressed without

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BHP Billiton – Superior production growth has delivered superior returns for shareholders

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Production growth [(a) ] Market capitalisation [(b)]
(Index: FY2001 production = 100) (US$bn) BHP Billiton
CAGR: 37%
240 US$230bn
170
210
160 BHP Billiton
8% CAGR
180
150
Rio Tinto
150
CAGR: 29%
140 US$122bn
120
Rio Tinto
130
4% CAGR
90
120
60 US$31bn
US$24bn
110
30
100 0
FY01 FY02 FY03 FY04 FY05 FY06 FY07
29-Jun-01 28-Jun-02 30-Jun-03 30-Jun-04 30-Jun-05 30-Jun-06 29-Jun-07 31-Oct-07
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Summary

• BHP Billiton approached Rio Tinto on 1 November 2007 and considers that pre-approach the companies’ market capitalisations demonstrated fair relative value

• This fair value is represented by a SER of 2.4:1, with Rio Tinto shareholders entitled to 36% of the combination[(a)]

• Since the date of the proposal and the subsequent announcement of the proposal terms

• Global roadshows have confirmed shareholders have a clear understanding of the compelling industrial logic of the deal

• Nothing has changed BHP Billiton’s view on relative fair trading value

• BHP Billiton is now directly offering Rio Tinto shareholders a material 45%[(b)] premium for control, continued participation in the combined company, and an opportunity to capture a pro rata share of the unique value unlocked by the combination

• This offer is compelling for Rio Tinto shareholders

a) Implied ratio of 2.4:1 and 36% holding of combined group based on BHP Billiton Plc and BHP Billiton Ltd closing share prices of £18.31 and A$46.10, Rio Tinto plc and Rio Tinto Ltd closing share prices of £44.90 and A$110.00,

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Notes:

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Appendix
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Indicative timetable

	Indicative timetable
	Event	Date
	Satisfaction of regulatory approval pre-conditions	Second half of 2008
	Posting of offer documents for Rio Tinto plc Offer and	Day 0
	Rio Tinto Ltd Offer to shareholders	(Within 28 days after the pre-conditions
		are satisfied)
	Last date for fulfilment of minimum acceptance condition in Rio Tinto	Day 60
	plc Offer
	Last date for fulfilment of all conditions to the Rio Tinto plc Offer	Day 81
	and all conditions to the Rio Tinto Ltd Offer (because offers
	are inter-conditional)
	First date for delivery of consideration under the offers	Within 14 days after the offers become wholly
		unconditional

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