Miner Rio Tinto completes Alcan packaging sale

MELBOURNE: Global mining giant Rio Tinto said Tuesday it had completed the sale of part of its Alcan operations to Australian packaging firm Amcor for 1.946 billion US dollars.

Rio Tinto borrowed heavily to fund its 38.1 billion dollar takeover of Canadian aluminium group Alcan in 2007 and said the latest sale was "another significant step in the recapitalisation of our balance sheet."

"Since the start of 2009 we have completed divestments of 5.6 billion US dollars despite a difficult environment created by the global financial crisis," Rio's chief financial officer Guy Elliott said in a statement.

"These proceeds, together with the proceeds from our successful rights issues and strong underlying cash flows, provide us with the flexibility to pursue value-adding investment opportunities as they arise."

In August, Rio Tinto announced it had received a binding offer for the businesses from Australian packaging firm Amcor for 2.025 billion dollars.

The final figure was lower because it does not include Alcan's medical flexibles packaging operations in the US, the sale of which is under review by US Department of Justice, the Anglo-Australian miner said.

The price also takes into consideration business performance over the past six months, it said.

Amcor said the businesses it was acquiring in the transaction were strongly aligned with the company's strategic growth markets.

"We are now focused on ensuring seamless integration of these businesses and on achieving the synergies and opportunities offered by this acquisition," Amcor chief executive Ken MacKenzie said in a statement.

Rio, which lists aluminium, copper, diamonds, coal, uranium and iron ore as among its major products, has announced asset sales of 10.3 billion dollars since February 2008.