Rio Tinto 'committed' to Chinalco deal

Rio Tinto Ltd says it remains committed to a planned $US19.5 billion ($A25.68 billion) partnership with a Chinese company and continues to seek shareholder feedback on the transaction.

The resources giant also said it expects to book a profit of $900 million from asset sales in the first half of its calendar 2009 reporting year.

The company on Friday was responding to a query from the Australian Securities Exchange about a decline in its share price to $58.95 on Thursday from $71.60 on May 8.

Rio Tinto said it was aware of ongoing market speculation that it might look for other alternatives to the proposed transaction with Aluminum Corporation of China (Chinalco) struck in February.

"The company remains committed to delivering this strategic partnership," it said in a letter to the exchange.

"The company continues to seek feedback from shareholders on this transaction and otherwise carry on its business in the usual course."

Rio Tinto shares dived nearly 12 per cent on Thursday amid speculation that the resources giant may alter or scrap the deal with Chinalco, which will provide it with funds to pay down some of its huge debt of about $US39 billion ($A51.37 billion).

If it succeeds, Chinalco would increase its stake in Rio Tinto from 9.3 per cent to 19 per cent.

But some shareholders, particularly in the UK, have expressed concern that the transaction may be too favourable to Chinalco.

Before it can go ahead, Rio Tinto needs to secure the approval of regulators in Australia and China and its shareholders.

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