Chinalco unit posts loss, cites Rio Tinto bid
Shanghai: The listed unit of state-owned Chinalco, China`s largest alumina producer, swung to a loss in the first half but is looking for overseas investments after a failed Rio Tinto bid, it said Tuesday.
Hong Kong- and Shanghai-listed Aluminum Corp of China Ltd, known as Chalco, posted a net loss for the first six months of 2009 of 3.5 billion yuan (USD 515 million) due to weak demand and falling prices, it said in a statement.
That compared to a net profit of 2.39 billion yuan in the same period a year earlier.
Revenue fell 29 percent year-on-year in the first half to 28.0 billion yuan, the company said.
Chalco said it was facing "unprecedented difficulties" this year with metals prices slumping as the global economic crisis hit the property and automobile sectors.
It said it expects to return to profit in the second half as production and prices rise.
Chalco said it is committed to becoming a global metals company despite a failed deal earlier this year with Australian mining giant Rio Tinto.
"In the second half, we will actively participate in overseas development projects and selectively participate in overseas exploration projects," Chalco president Luo Jianchuan told reporters.
In June, Chinalco saw the collapse of its USD 19.5 billion bid to increase its stake in Rio Tinto to about 18 percent -- in what at the time would have been China`s largest ever foreign investment.
Chinalco president Xiong Weiping said the firm was open to foreign partners, including Rio Tinto, but shrugged off reports it was in talks with the Australian firm to jointly produce alumina and bauxite.
"We`re willing to keep in touch with global peers including Rio Tinto and to discuss strategic cooperation, but we are really unaware of the talks reported by Australian media over the past few days," Xiong said.
Chinalco has distanced itself from the arrest of four Shanghai-based Rio Tinto employees accused of stealing commercial secrets, saying their detention had no connection to the failed deal.
Xiong said Chalco is studying a partnership with the Saudi Binladin Group and Malaysia`s MMC Corporation to develop a 1.05 million tonne-capacity aluminium smelter in Saudi Arabia.
"We would not rule out cooperation with global mining giants as long as it is mutually beneficial and win-win. We are getting more mature after the Rio Tinto matter."
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