Rio Tinto mulls capital hike in Alcan bid

ZURICH, Sept 28 - Global miner Rio Tinto will not rule out raising capital to maintain its A credit rating as it prepares to spend $38.1 billion to take over Canadian aluminium producer Alcan, Chief Executive Tom Albanese said on Friday. Albanese said in an interview with Swiss paper Finanz und Wirtschaft that Rio Tinto expected to raise funds from the sale of Alcan's packing division and that all of Alcan's business divisions would be examined for possible sale. "If these measures are not enough, a capital hike cannot be ruled out," he was quoted as saying in an article distributed to the media one day ahead of publication. Alcan's engineering division, which makes aluminium products for the aircraft industry, would also be examined for possible sale, he said. "We have always said that we want to keep this high-margin unit. But at the same time, we have emphasised that we would examine all the corporate divisions. That's true for the Engineering Products division as well," he said. Albanese said the group was looking to expand its uranium mining operations in Africa as rapidly as possible, but that transportation problems in the coal sector in Australia were so serious that the group had decided not to open any new coal mines there. The merger was was likely to conclude by the end of the year, he said. "I can assure you that everything is going according to plan. We will close the transaction in the fourth quarter," Albanese told the newspaper. Albanese said that analyst forecasts for profit growth of 12 percent per year was in the "realm of the possible."