Rio Reiterates Commitment to Chinalco Deal After Stock Drops

April 8 (Bloomberg) -- Rio Tinto Group, the world’s third- largest mining company, is continuing with a proposed $19.5 billion investment from Aluminum Corp. of China amid concern the deal won’t proceed. Rio “reiterates its commitment to delivering this strategic partnership and will otherwise carry on its business in its usual course,” the London-based company said today in a statement to the Australian stock exchange today in response to a query about share price movements. The plan to sell convertible bonds and stakes in projects to Chinalco, as state-owned Aluminum Corp. is known, has drawn criticism from investors including Legal & General Group Plc, the second-largest institutional shareholder, as well as Australian lawmakers. The deal needs approval from regulators and shareholders to proceed. Rio was asked to explain a 10 percent decline in its Australian-listed shares yesterday. The decline was the biggest drop in four months as investors became concerned that Rio would sell shares at a discount should the deal with Chinalco fail. Rio shares declined 2.2 percent in London yesterday. To contact the reporter on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net