Norsk Hydro planning bid for Alcan, report says

 Norsk Hydro ASA (NHY.OL: Quote, Profile , Research) is mulling a bid for Alcan Inc. (AL.TO: Quote, Profile , Research), adding another player to the fray eyeing the Canadian aluminum producer, a Canadian national newspaper said on Monday.

The Globe and Mail, citing investment bankers working with two other companies, said the Norwegian state-backed company has begun work on a bid worth more than $30 billion.

"There are advantages," one banker close to Alcan told the paper. "Obviously there are synergies there and there are certain similarities in terms of potential desires by governments. It has interesting potential."

Norsk is 43 percent owned by the Norwegian government.

 The paper said if Norsk does bid, it could tap into the government's pension fund which is valued at about $292 billion.

A separate report on Monday said Rio Tinto Ltd. (RIO.AX: Quote, Profile , Research) (RIO.L: Quote, Profile , Research) had hired Deutsche Bank to advise it on a possible bid for the Canadian aluminum producer.

Last week Alcan rejected Alcoa's (AA.N: Quote, Profile , Research) $28.4-billion takeover bid and said it was in talks with third parties.

($1=$1.08 Canadian)