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Rio Tinto Confirms Talks With Chinalco

Mining giant confirmed it is in talks about a possible transaction with Aluminum Corp. of China in response to media reports that the Chinese company may take a big stake in Rio Tinto.

NEW YORK (AP) -- Rio Tinto confirmed Wednesday that it is in talks about a possible transaction with Aluminum Corp. of China, in response to media reports that the Chinese company may take a big stake in the London-based mining giant, which is struggling under the weight of heavy debt.

"Rio Tinto notes continued media speculation in connection with a possible transaction with Chinalco and confirms the parties are in negotiations, which may or may not lead to any agreement being reached," Rio Tinto said in a statement.

Chinese state-run newspaper Economic Observer and other outlets reported earlier this week that Aluminum Corp. of China -- also known as Chinalco -- was in the final stages of talks to make a multibillion-dollar investment in Rio Tinto, with a deal expected sometime this week. The Wall Street Journal and Financial Times reported Wednesday that a deal worth about $19 billion had been reached.

Earlier this month Rio Tinto said it was negotiating with Chinalco about the Chinese company buying minority stakes in some of its operations -- a move that could provide a big capital injection as the mining giant struggles to pay down its debts.

Chinalco already has a 12 percent stake in Rio Tinto and the deal under discussion could significantly raise Chinalco's share of the Anglo-Australian miner.

U.S.-traded shares of Rio Tinto were halted on the New York Stock Exchange at $112.80, after climbing $5.43, or 5.1 percent earlier in the session.

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