Dec. 31 -- Rio Tinto Group, the world’s third- largest mining company, sold its stake in an aluminum smelter in China to a partner to help reduce debt.
Qingtongxia Aluminium Co. will buy Rio Tinto’s 50 percent stake in the venture, Jim Singer, a Brisbane, Australia-based spokesman for London-based Rio Tinto, said without revealing the sale price. Calls to Qingtongxia weren’t immediately answered.
Rio Tinto is cutting capital spending and selling assets to pay $38.9 billion of debt, mostly acquired when it took over Alcan Inc. last year, as aluminum prices slide. Demand for the metal in China, the world’s largest user, may rise next year at the slowest pace since 1997, according to Beijing Antaike Information Development Co.
“The deal may be valued at several hundred million yuan,” Wan Ling, a Beijing-based analyst at CRU International Ltd., said by phone today. “Rio may also sell its packaging and engineering product assets in China as part of a global strategy.”
Rio shares rose as much as 5 percent in Sydney trading and were up 4.3 percent at A$38.64 at 1:55 p.m. local time.
Alcan paid about $150 million in 2004 for the 50 percent stake in the smelter that can produce as much as 150,000 metric tons of the metal a year. Qingtongxia owns 30 percent with the remainder owned by Ningxia Electric Power and Investment Co.
“Completion of the transaction is expected in the first quarter of 2009, pending clearance of certain Chinese government approvals,” Singer said by phone.
The joint venture is Rio’s only aluminum smelting plant in China and includes 43.5 percent of a coal-fired power plant.
Rio Tinto said last November it may sell as much as $30 billion of assets. It wants to sell Alcan’s packaging and engineering product units, its talc unit and other mining projects.
(Bloomberg)
No comments:
Post a Comment