Global miner BHP Billiton has sold its stake in a South African titanium operation to rival Rio Tinto , marking its exit from the titanium minerals industry.

BHP said on Wednesday it had exercised an option to sell its 37 percent stake in Richard Bay Minerals to Rio Tinto, with the final cost to be agreed by a previously agreed valuation process.

Rio's stake in Richard Bay will rise to 74 percent, Rio said in a separate statement.

Doubling our stake in the business solidifies our position at a time when the long-term outlook is strong and demand for higher grade titanium dioxide is growing, driven by urbanisation and rising environmental standards, said Rio Tinto Diamonds and Minerals chief executive Harry Kenyon-Slaney.

(Reporting by Rosalba O'Brien; Editing by Paul Sandle)