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SYDNEY - Australia's competition watchdog said today it will not stand in the way of Rio Tinto Ltd's proposal to buy Canada's Alcan Ltd , which would make it the world's biggest aluminium producer.
Rio Tinto also owns Comalco, which controls 79.36 per cent of New Zealand Aluminium Smelters Ltd (NZAS). Sumitomo Chemical Co of Japan owns the other 20.64 per cent.
The Australian Competition and Consumer Commission (ACCC) said there would not be a lessening of competition in the sector caused by the planned acquisition.
Rio is offering US$101 ($134.52) a share, valuing Alcan at US$38.1 billion.
With a combined aluminium smelting capacity approaching 4.4 million tonnes -- out of a projected 37 million tonnes to be consumed worldwide this year, Rio would easily eclipse other sector giants Rusal, China Aluminium and Alcoa in size.
The deal would also elevate Rio to the world's No.1 bauxite miner and put it on the way to becoming the top alumina supplier, without which aluminium cannot be made.
The deal has already received regulatory approval in Canada, the United States and Europe.
Rio Tinto's NZAS smelters at Tiwai Point use 13 per cent of New Zealand's electricity and employ about 8000 people.
- REUTERS
