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Alumina shares soar on China investment
Edited by : AL CIRCLE
2 min read
Shares in Alumina have hit their highest level in nearly 12 months after a large Chinese investor took a $452 million stake in the under pressure aluminium producer.
CITIC will buy more than 366 million new Alumina shares, which will equate to just over 13 per cent of Alumina's total share base, under a deal announced today.
Alumina said the Chinese government owned investment firm would be a strategically aligned and financially strong long-term investor.
Proceeds of the share sale will be used to reduce debt, Alumina said.
Its shares soared on the news, adding 14.5 cents, or 11.6 per cent, to $1.35 by 10.44am AEDT. That was their highest level since March 2012.
"CITIC's investment demonstrates their confidence in the alumina industry and their understanding of Alumina Ltd's unique position in the global market," Alumina chief executive John Bevan said.
Melbourne-based Alumina's only earning asset is its 40 per cent stake in Alcoa World Alumina and Chemicals (AWAC), with Alcoa holding the controlling remaining 60 per cent. AWAC owns aluminium smelters at Portland and the struggling Point Henry plant in Victoria.
Falling aluminium prices and the high Australian dollar have put Alumina under financial pressure, falling to a loss of $US14.6 million in the first half of calendar 2012. The company will release its results for the full year on February 21.
CITIC will buy more than 366 million new Alumina shares, which will equate to just over 13 per cent of Alumina's total share base, under a deal announced today.
Alumina said the Chinese government owned investment firm would be a strategically aligned and financially strong long-term investor.
Proceeds of the share sale will be used to reduce debt, Alumina said.
Its shares soared on the news, adding 14.5 cents, or 11.6 per cent, to $1.35 by 10.44am AEDT. That was their highest level since March 2012.
"CITIC's investment demonstrates their confidence in the alumina industry and their understanding of Alumina Ltd's unique position in the global market," Alumina chief executive John Bevan said.
Melbourne-based Alumina's only earning asset is its 40 per cent stake in Alcoa World Alumina and Chemicals (AWAC), with Alcoa holding the controlling remaining 60 per cent. AWAC owns aluminium smelters at Portland and the struggling Point Henry plant in Victoria.
Falling aluminium prices and the high Australian dollar have put Alumina under financial pressure, falling to a loss of $US14.6 million in the first half of calendar 2012. The company will release its results for the full year on February 21.
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