The Anglo-Australian giant's chief executive Marius Kloppers said while he believed the bid of 3.4 BHP shares for every Rio Tinto share was attractive, it was still up to shareholders to determine whether it went ahead.

Kloppers acknowledged that the ratio of the value of Rio Tinto shares to BHP Billiton shares this month fell to under three for the first time since the bid was launched.

The chief executive said this could be linked to the strong performance of BHP -- which last week posted a 14.7 percent rise in annual profit to 15.39 billion US dollars -- but said some investors were waiting for the outcome of regulatory rulings.

"I think it's a combination of how our commodities versus Rio's commodities have developed," he told Australian Broadcasting Corporation television.

"And I think it's fair to say that investors are still waiting, sitting on the sideline a little bit, to see how we clear our regulatory pre-conditions on this deal."

Adding to the sentiment that the market is less confident of the takeover succeeding, on Friday the Australian competition watchdog said the mega-merger could potentially hurt competition in the global iron ore market.

The Australian Competition and Consumer Commission said it expected to make its final decision by October 1. European, US and South African regulators will do likewise by the end of the year.

Kloppers refused to comment on whether the deal would go ahead without the merger of the two companies' iron ore businesses.

"It's very hard to speculate on things that we don't think are going to happen and that are not the base line that we are planning around," he said.

Rio Tinto has repeatedly rejected the BHP Billiton bid, saying it greatly undervalues the company as both firms enjoy huge demand for their raw materials from rapidly industrialising Asia.

China, for its part, has expressed concerns that the proposed merger would create a behemoth with too much control of world iron ore markets.

Since BHP's bid was first announced, China-owned companies have bought into Australian resource firms, including a raid by aluminium giant Chinalco for a strategic stake in Rio.

The moves have provoked debate in Australia about state-controlled Chinese firms -- so-called China Inc -- buying resources firms to directly control the resources needed for the country's industrial expansion.

Australian Treasurer Wayne Swan said Sunday he had approved Chinalco's acquisition of up to 14.99 percent of the London-listed arm of Rio Tinto -- an amount which would equate to about 11 percent in the group.

"I have determined that the undertakings agreed with Chinalco are acceptable for protecting the national interest in this matter," he said.

On China, Kloppers said that while there had been some slowdown in the Chinese economy, the country's building programme was still very strong.

"It's important to understand though that the Chinese economy is still growing at four, five times the developed world and that each unit of growth consumes five times the units of metal that a similar pace of growth in the western world would consume," he said.

Kloppers said he still hoped that the merger with Rio would go ahead.

"We believe that our bid, particularly given the value of our company and the synergies, is a very attractive one," he said.

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