The worldÔÇÖs third largest mining company, Rio Tinto, has sold its Alcan Composites unit to SwitzerlandÔÇÖs Schweiter Technologies, it announced today.
The deal, worth $349 million (Ôé¼237 million) is part of Rio TintoÔÇÖs ongoing strategy to offload some of its assets in order to cut its current debt, which is understood to be around $24 billion (Ôé¼16 billion).
Much of the debt was accrued during its $38 billion takeover of Alcan in 2007, at the height of the commodity boom.
Swiss firm Schweiter is the worldÔÇÖs number one manufacturer of testing equipment for light emitting diodes (LEDs). Its business currently consists of the SSM Textile Machinery and Ismeca Semiconductor divisons. It is thought that Alcan Composites will form a third, standalone division within the group.
Alcan Composites, also based in Switzerland with its headquarters in Sins, manufactures sandwich composite materials for the architecture, wind energy and display sectors.
It operates 16 plants in Europe (Germany and Switzerland), the US, South America, China and India, employing around 3,000. Over the 12 months to August 2009 it achieved sales of $649 million (Ôé¼440 million).
Its brands include Airex, Baltek, Dibond, Gator, Kapa, Forex, Sintra and Fome-Cor.
Guy Elliott, finance director at Rio Tinto, said of the deal: "In the last three months we have made significant inroads into divesting the downstream assets acquired with Alcan, including offers or agreed sales for the majority of Alcan Packaging and Cable.
"Schweiter Technologies is well placed to successfully develop the Composites business, and we are realising further value for Rio Tinto shareholders." The sale is expected to complete by the end of this year, subject to regulatory approval.
Last week, Rio Tinto confirmed it had sold 56 per cent of its Alcan Engineered Production Cable unit to US-based private equity firm Platinum Equity, for an undisclosed amount.
*        *        *
