Chinalco would have liked stake in Alcan assets

Miningweekly cited Mr Xiao Yaqing president of Chinalco as saying that aluminum Corp of China would have included former Alcan aluminium assets in its investment agreement with Rio Tinto if it had been offered the opportunity.

He said that ¡°It is very simple, Rio Tinto does not want to sell, otherwise we would very much have liked to invest.¡±

Rio Tinto, which bought Canadian aluminium group Alcan in 2007 for USD 39 billion announced on Thursday that it had agreed to sell stakes of up to 50% in some aluminium, iron ore and copper assets to Chinalco, plus USD 7,2 billion in convertible bonds. If the transaction is successful, Rio Tinto will receive a whopping USD 19.5 billion cash injection with which to set about improving its balance sheet, and Chinalco can double its stake in the world's third-biggest mining company to 18% by converting the bonds.

The Alcan acquisition, funded for the most part through debt when commodity prices and demand were surging, is the main reason that Rio has now had to go looking for funds. However, Mr Tom Albanese CEO of RIO insisted on Thursday that the purchase was not a mistake. He said that ¡°The investment basis for the Alcan acquisition remains sound.¡±

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