SYDNEY (AP) -- An almost $2 billion deal for Australian packaging company Amcor to buy a big chunk of Rio Tinto's Alcan business has been completed, the companies said Tuesday, helping the global miner reduce its debt and marking a significant expansion for Amcor.
The London-based mining giant announced in December it would accept Amcor's offer to buy Alcan Packaging's global pharmaceuticals, global tobacco and food divisions in Europe and Asia as part of plans to reduce debt by selling off assets that are not at the core of its business.
Rio Tinto has sold some $10.3 billion in assets since February 2008 to help pay off debts due mostly to its acquisition of Canadian aluminum giant Alcan for $38 billion in 2007.
"The completion of this complex transaction is another significant step in the recapitalization of our balance sheet," Rio Tinto's chief financial officer Guy Elliott said in a statement.
The asset sales along with money raised from share issues and cash-flow from the company's operations would give it flexibility to take advantage of investment opportunities as they arise, he said.
The deal does not include the sale of Alcan Packaging Medical Fexibles in the United States, an aspect that was still under review by the U.S. Department of Justice.
EU antitrust regulators approved the plan earlier this month after telling Amcor, an Australian packaging company, it must sell two pharmaceutical packaging plants. That was to eliminate concern the deal would knock out a major rival and make Amcor a very strong European supplier for laminated drug sachets and the foil used for pill blister packs.
Melbourne-based Amcor is the world's largest maker of packaging commonly used in drink bottles and other containers. It also makes wine bottles, cardboard boxes and a wide range of other packaging products. Alcan Packaging specializes in making packaging for food and drinks, as well as pharmaceutical, medical, beauty and tobacco products.
Amcor said in a statement it would rebrand the company following the acquisition.
Rio Tinto shares surged more than 5 percent to Australian dollars 70.81 by midafternoon in Sydney, while Amcor rose more than 2.5 percent to AU$6.01.