Rio, OZ Minerals China Sales Probed by Australian Regulator

Feb. 24 (Bloomberg) -- Investments worth $21.1 billion by Chinese state-owned companies in Rio Tinto Group and OZ Minerals Ltd. are being assessed for competition issues by Australia’s government as part of the required approval process. Groups affected by Aluminum Corp. of China’s $19.5 billion investment in Rio have until March 5 to make submissions to the Australian Consumer and Competition Commission, the commission said in a letter dated Feb. 19 on its Web site. Anyone affected by China Minmetals Group’s A$2.6 billion ($1.7 billion) takeover of OZ Minerals have until March 12 to make a submission. Both investments require approval from the Australian government and shareholders in the companies. China, the world’s biggest consumer of raw materials, is stepping up purchases of mineral producers in Australia, taking advantage of a 36 percent plunge in commodity prices last year. Rio dropped 2.3 percent to A$45.80 at 10:44 a.m. Sydney time on the Australian stock exchange. OZ Minerals fell 3.3 percent to 59 cents at the same time. Aluminum Corp of China, or Chinalco as the company is known, agreed on Feb. 12 to buy $7.2 billion of convertible bonds and spend $12.3 billion on stakes in Rio Tinto mines. The commission will consider whether Chinalco’s investment would lessen competition, it said in the letter. Chinalco’s listed subsidiary is considering building an alumina refinery in Queensland state, it noted. Brent Rebecca, a spokesman for the commission, confirmed today the letter had been sent to companies that may be affected. The regulator will announce findings on March 25, it said. China Minmetals, the nation’s biggest trader of metals, agreed to buy OZ Minerals last week to secure supplies of copper, zinc and gold. Findings into the proposal will be announced April 1, the commission said on its Web site. “We are going to work with all the regulators as part of the process,” Matthew Foran, a spokesman for Melbourne-based OZ, said today by phone. The commission is an independent authority that administers the Trade Practices Act and promotes competition and fair trade, according to its Web site. To contact the reporters on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net; Jesse Riseborough in Melbourne at jriseborough@bloomberg.net