Rio Tinto nears sale of Alcan packaging assets

Rio Tinto is reportedly set to announce the sale of Alcan's non-beauty aluminum packaging assets to Australia's Amcor Ltd. for $2 billion US. Trading of Amcor's shares was halted Monday pending an announcement that could come prior to its quarterly results announcement Tuesday. The three-month stock chart for Rio Tinto's US-listed ADR Melbourne-based Amcor acknowledged in February that it was in talks to purchase a portion of the packaging assets. Rio Tinto has sold off numerous assets to reduce the huge debt it acquired in 2007 with the $38.1 billion purchase of Alcan, which was headquartered in Montreal. So far the mining giant has netted more than $5 billion from asset sales. In July, it announced the $1.2 billion sale of the Alcan Packaging Food Americas division to U.S.-based Bemis Company Inc. The company has said it will likely sell its beauty and personal care packaging business in a separate transaction. Rio Tinto spokesman Nick Cobban declined to confirm the report of an impending sale to Amcor or indicate how soon a deal could be announced. Large Canadian presence Amcor operates bottle PET plants in Mississauga and Brampton, Ont., as well as Moncton, N.B., but no health-care facilities. PET is the common name for polyethylene terephthalate, a resin used in liquid containers. Rio Tinto has about 500 employees at five packaging plants in Canada: Brampton (beauty sector); Woodbridge, Ont. (tobacco and pharma sector); Lachine, Que. (tobacco sector); Baie d'Urfe, Que. (pharma sector); and Saint-Cesaire, Que. (food packaging Europe sector). It had originally planned to sell the Alcan Packaging unit as a single entity but was forced to change its plans after the economic downturn made it difficult to find one potential buyer. The purchase would make Amcor a dominant player in flexible food packaging and tobacco packaging in Europe. It would have about 50 per cent of the European tobacco packaging market and have a big growth opportunity from pharmaceuticals in Europe. With files from The Canadian Press