SYDNEY: Mining giant Rio Tinto on Friday confirmed a huge take-up for its record rights offering after investors snapped up the Australian portion, allowing it to pay off a large chunk of its heavy debt.

The dual-listed firm, whose share offer came at rock-bottom prices in Sydney and London, announced a 95 percent subscription among Australian investors following a 97 percent take-up in Britain.

Rio can now slash its debt bill incurred by last year's acquisition of Canada's Alcan. The offering, worth 15.2 billion US dollars, was the industry's biggest and the fifth-largest in history.

The Anglo-Australian giant announced the move last month along with an iron-ore joint venture with fierce rival BHP Billiton, snubbing a massive cash injection by China's Chinalco.

"It's positive that the rights issue has been completed -- it certainly takes a lot of stress off the balance sheet," said Michael Bush, head of credit research at National Australia Bank.

"It was a fairly heavily discounted rights issue so it was a bit of a no-brainer in terms of whether people should take it up. It's positive for Rio that the money's in the door and they can now pay down debt."

The new shares were issued at a price of 28.29 Australian dollars (22.50 US), a massive discount to the 51.75 dollars they closed at after Sydney trading the previous day.

Chinalco on Thursday said it had taken up its allocation to remain Rio's biggest shareholder, warning that it would keep a close eye on developments.

China has said it may oppose Rio's joint venture with BHP, aimed at merging their vast Western Australia operations, on anti-monopoly grounds.

"(The rights offering) has put behind them the Chinalco tie-up and they're able to get on with their business," said Tim Schroeders of Pergana Capital.

"They don't have to worry about the next refinancing window and they can start to plan for the longer term in terms of projects or financing acquisitions."

Analysts also said the successful rights issue would strengthen Rio's hand as it looks to sell off assets. The miner dropped 38 billion US dollars into the red with its purchase of aluminium company Alcan.

"It's given them a bit of respite in terms of looking to sell assets at bargain basement prices," Schroeders said.

Australian investors bought 142,149,887 of the new shares, Rio said in a statement. The firm was in a trading halt while underwriters seek subscribers for the remaining 7,865,410.

Rio courted Chinalco for several months before walking away from the 19.5 billion US dollar cash injection, following a recovery in commodities prices.

The mooted deal had proved unpopular in Australia, with many politicians and commentators voicing concern about China's march into the country's resources sector.