Others News
- Chinalco in bid for Peru Copper
Date: 10-Jul-2007 Sources: (Xinhua Online)
BEIJING, July 10 -- Aluminum Corp of China (Chinalco), one of the world's leading producers of both aluminum and alumina, has offered to buy Peru Copper Inc, headquartered in Vancouver, Canada, for around $790 million.
'We have made an offer to purchase all the outstanding common shares of Peru Copper for C$6.6 ($6.27) per share in cash,' Xiao Yaqing, president of Chinalco told China Daily in an exclusive interview.
'Concurrent with the announcement of our intention to make the offer, we agreed to invest C$70 million ($66.5 million) to subscribe to a 9.9 percent interest in Peru Copper at a price of C$5.3 per share, ' he said.
Peru Copper is listed in Toronto stock market.
Chinalco's Peru Copper deal is part of its ongoing efforts in overseas expansion, analysts say.
It already has aluminum-related projects in Australia, Africa, Southeast Asia and South America, Xiao said.
Chinalco is now the world's fourth-largest aluminum company.
Peru Copper said it would use the money to fund its Toromocho project, a copper mine in Morococha in central Peru.
The company is now also investing in bauxite mining projects in countries such as Vietnam and Guinea. 'Our project in Vietnam includes bauxite mining and alumina production, with the total investment of over $1 billion,' said Xiao.
'Now we are also doing exploration work for bauxite mine reserves in Guinea. The project will have the capacity of over 1 billion tons,' he added.
This March Chinalco signed an agreement with the government of Queensland, Australia, to develop the Aurukun bauxite mining project. The A$3 billion ($2.58 billion) deal is by far the largest investment deal by a Chinese company in Australia.
Overseas mining resources are important for Chinalco, said Xiao. As China's national aluminum company, Chinalco's quick expansion has pushed up its demand for the resources.
China now has become the world's largest aluminum products maker and consumer, but China's bauxite mine resources only account for 2 percent of the world total.
'But the bauxite mine resources we have now bought overseas is equal to one-third of China's total reserves,' said Xiao.
'Our overseas projects have contributed a lot to the development of the local economy,' he said. 'For instance, our investment in Australia has helped improve the economy in the region.'
Despite a series of mergers and acquisitions in the world's aluminum industry, Xiao said Chinalco now has no plans to buy its global rivals.
In May, the world' largest aluminum company Alcoa of the US said it agreed to buy the world's second-largest aluminum company Alcan in Canada.
'Now is not the best time for us to acquire foreign companies. We are making efforts to make our company more multinational,' he said. Instead, Chinalco chose to 'buy many domestic aluminum companies to increase its capacity'.
'Now our sales focus more on the domestic market. We aim to increase our overseas sales to one-third of the total in the next 5 to 10 years.'
Last year sales revenue of the company was around $13 billion, a growth of more than 30 percent year-on-year.
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