Metal Products News
- Chalco eyes August buy of Liancheng
Date: 24-Jul-2007 Sources: (Shenzhen Daily)
ALUMINUM Corp. of China Ltd. (Chalco), is likely to buy Liancheng Aluminum Co. in August from its parent, an official at the acquisition target said yesterday.
The move would mean another boost for Chalco's aluminum capacity after the company said in July it had agreed to buy sister smelter Baotou Aluminum for about US$2 billion in stock.
'We should be able to finish the consolidation (with Chalco) next month,'an official at Liancheng said, without providing a price tag for the deal.
Baotou has annual capacity of 300,000 tons of primary aluminum and Liancheng, in northwestern Gansu Province, has annual capacity of 270,000 tons of primary aluminum and about 40,000 tons of semi-finished aluminum products.
'That should boost Chalco's aluminum capacity by about 10 percent,'an analyst in Hong Kong said of the Liancheng deal.
Chalco, the world's No. 4 producer of primary aluminum in 2006, has said it plans to lift its annual aluminum capacity to 3 to 3.5 million tons by end-2007 from 2.5 million last year.
Chalco, which is 8 percent-owned by the world's top producer Alcoa Inc., listed in Shanghai in April through a share offer to buy out two units, smelter Lanzhou Aluminum and alumina maker Shandong Aluminum.
The company said in April it would take over Liancheng and Tongchuan Xinguang Aluminum within a year of it buying out its units in a bid to boost its aluminum production.
Chalco investor relations manager Zhang Qing said a deal would be struck with Liancheng soon.
Chalco is the world's third-biggest producer of alumina, the material used for aluminum production, with capacity at 9 million tons in 2006.
Its alumina production rose 11 percent to about 4.3 million tons in the first five months of this year, while primary aluminum output surged 75 percent to 1.1 million tons, according to local media reports.
It planned to produce about 9.1 million tons of alumina and 2.7 million tons of primary aluminum this year.
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