Rio Tinto receives $345 million offer for European aluminium assets

Rio Tinto (LSE:RIO) has received a US$345 million binding offer from Norway’s Norsk Hydro for its European aluminium assets, which include the ISAL Smelter in Iceland.

Along with the 205,000 tonnes a year capacity smelter, Hydro also made offers for majority stakes in the mining giant’s Dutch and Swedish aluminium assets.

The aluminium and green energy company placed an offer for a 53% stake in the Aluchemie anode plant in the Netherlands (of which it already owns the remaining 47% stake) and asked for Rio’s 50% share in the Alufluor aluminum fluoride plant in Sweden.

“The offer demonstrates our strong belief in aluminum, which is seeing the strongest global demand growth among base metals,” said Hydro’s president and CEO Svein Richard Brandtzæg.

Hydro is making concerted efforts to ensure its aluminium production is powered from renewable sources, and the acquisition of the renewable energy-powered Icelandic smelter will boost its total capacity by 210,000 tonnes to 2.4 million tonnes this year.

For Rio, the potential divestment would be the latest of a recent streamlining drive within the business. The Anglo-Australian firm said it will launch a consultation process on the offer, and expects to complete the sale in the second quarter of 2018.