Rio Tinto mulls spin-off of Aussie aluminium unit

MINING giant Rio Tinto is considering spinning off part of its aluminium assets in Australia.

The company is understood to be working with Macquarie Group and PricewaterhouseCoopers on options for its aluminium operations, which could come under pressure if the Australia government’s proposed carbon tax comes into force.

The miner said it would not comment on market speculation yesterday.

However, Rio chief financial officer Guy Elliott told investors last week there were some assets in its aluminium portfolio, which were not aligned with its strategy.

“These are assets that we would consider divesting if it makes sense. Of course, we would want to achieve good value if we decided to sell them,” Elliott said.

Rio’s aluminium business in Australia is made up of three refineries, three smelters and two bauxite mines, the paper said, adding Rio would hold onto the mines as they offer the highest margins.

Rio last week told investors it plans to achieve 40 per cent earnings before interest, tax, depreciation and amortisation margin from the aluminium business through the sale of two non-specified assets.

Shares in Rio Tinto closed down 41p at 2,943.29p to value the group at around £56bn.