Chalco to Sell Stake in Iron Ore Venture to ParentBloomberg News
Aluminum Corporation of China Ltd., the Hong Kong-listed unit of the nation’s largest producer of the metal, plans to sell its stake in a venture in Guinea to a unit of its parent for about $2.07 billion.
The state-owned company, known as Chalco, announced on Sept. 30 the sale to its parent of a 65 percent stake in a venture that mainly invests in the Simandou iron-ore project. The value of the stake was not disclosed at the time.
The appraisal value of the asset is about $2.07 billion and the transaction value will be no less than that, the company said in filings to the Shanghai and Hong Kong stock exchanges yesterday.
Rio Tinto Group, the world’s second-largest mining company, said last month that the $20 billion Simandou project may start in 2018 at the earliest, three years behind the initial target, pending completion of funding. The company is helping Guinea get financing for its half share of the project’s port and rail.
In 2010, Chalco paid $1.35 billion for a stake in a venture with Rio Tinto that gave it an effective 44.65 percent stake in the Simandou mine.
It later formed another venture with Baosteel Group Corp. and other Chinese investors to hold that stake. Chalco is now selling its holding in the venture with the other Chinese companies to its parent.
The sale requires approvals from Rio Tinto and the Chinese government, Chalco said in September.
— With assistance by Michael Wei