Sydney - Anglo-Australian mining company BHP Billiton Ltd said Tuesday the global financial crisis had caused it to abandon a 20-billion-US-dollar takeover bid for rival Rio Tinto Ltd.

"While we have not changed our view of the basic industrial logic of the combination, or of the longer term prospects for natural resource demand growth driven by emerging economies, we have concerns about the continued deterioration of near term economic conditions," BHP chairman Don Argus said in a statement.

BHP, the world's biggest mining company, had offered 3.4 of its shares for every Rio share in what was to be an all-scrip bid.

Rio is the world's second-largest iron ore producer and BHP is the third largest. Steelmakers, particularly those in China, had urged regulators in Australia and Europe to block the takeover for fear that an iron ore cartel would be formed.

BHP needed the approval of the European Commission for the takeover to proceed and had been concerned it would be asked to sell assets to deal with competition concerns.

It said the bid was off because of the "difficulty of achieving fair values for those assets in the current climate."

The bid had received clearances from regulators in the United States and Australia.

Rio Tinto acknowledged BHP's decision but declined comment. (dpa)