Kiwi magnate eyes Alcoa offshoot

GRAEME Hart, the former truck driver who is New Zealand's richest man, will pay $3.1 billion for U.S. aluminium major Alcoa's packaging business. Mr Hart's Rank Group already owns a world-scale packaging operation and has sometimes been mentioned as a possible bidder for Australia's Amcor. The deal will allow Alcoa, which has been a prime takeover target since its bid early this year for Canada's Alcan was trumped by Rio Tinto, to concentrate on its bauxite, alumina and aluminium metal businesses. Higher raw material costs have hurt profit at Alcoa's packaging unit, which has $US3.2 billion in sales and 10,000 employees worldwide. It will also enable Alcoa to focus on so-called upstream mining and aluminium businesses as demand and prices for the metal rise, stoked by emerging economies such as China and India spending more on construction and consumer goods. ``Alcoa is better off without packaging; this is a low-margin business,'' said Soleil Securities analyst Charles Bradford. ``The best returns are in the upstream.''