BHP Billiton, already the world's biggest mining group, is likely to face tough scrutiny by regulators in iron ore, coal and aluminum in its quest to merge rival Rio Tinto, but it believes it can overcome the hurdles.

BHPB without giving any specifics about how it would satisfy antitrust watchdogs while announcing its approach to Rio Tinto said "In preparing its proposal, BHP Billiton has examined in detail the regulatory issues and other practicalities of a combination.”

Mr Henk Groenewald portfolio manager at Coronation Fund Managers in South Africa said "They would have definitely have thought of it and not gone ahead if they thought the competition authorities would put conditions on them that they were not willing to comply with.”

Mr Bert Foer head of the American Antitrust Institute in Washington said "On the face of it sounds like the type of merger that would attract not only the attention of the Justice Department but also the European Union and Australia.”

BHP Billiton accounts for around 15% of world iron ore sales, while Rio Tinto is responsible for 24%, which would put the combined company at 39%. Rio produces around 140 million tonnes of iron ore a year and BHP is at around 100 million tonnes with their major operations in Western Australia. Brazil's CVRD is the top ranking producer of iron ore.

In coking coal, BHP already has around 30% of the seaborne market through an alliance with Mitsubishi Corp and a takeover of Rio would add another 5%.

Thermal coal is less of a concern, with each having around 5% to 6% of the seaborne market.

Rio Tinto's recent takeover of Canada's Alcan Inc vaulted it to the top ranking in the aluminum sector and BHP Billiton is the world's 6th biggest producer of primary aluminum. The tie up of the two would give a merged firm around 15% of the total market.

In copper, the two already have joint ownership of Escondida in Chile, the world's largest copper mine, and a marriage would increase total share of mine output to around 13%.