The Aluminium Corporation of China (Chalco) has announced that it will be selling its shares in a number of aluminium processing companies, but whether such a move will aid the company's financial woes is debatable.
The company is selling its stakes in the following businesses: Chalco Henan Aluminium Fabrication in Luoyang (86.84%); Chalco Southwest Aluminium Sheet/Strip Co of Chongqing (60%); Chalco Southwest Aluminium Cold Rolling Co of Chongqing (100%); Huaxi Aluminium Co in Chendu (56.86%); Chalco Ruimin Co of Fuzhou (93.47%); Chalco Qingdao Light Metal Co of Qingdao (100%); Sapa Chalco Aluminium Products of Chongqing (50%); and a 40% share in the Chalco Aluminium Co in Guizhou.
The move will decrease Chalco's assets by RMB15 billion and will take the company out of the fabricating business, allowing it to concentrate solely on upstream alumina refining and aluminium smelting.
Chalco's parent, Chinalco, is likely to buy Chalco's equity shares in the above-mentioned businesses.
In 2012, Chalco reported deficits of RMB8.23 million and losses for the first three months of 2013 of RMB975 million.
Last year, China had capacity to produce 27Mt/yr but only produced 20.3Mt.
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