- Deal underscores Chinese overseas expansion amid domestic constraints
- Low-carbon aluminium assets gain strategic value
China’s Aluminium Corporation of China (Chinalco) and Anglo’Australian miner Rio Tinto have agreed to acquire a controlling stake in Brazil’s Companhia Brasileira de Aluminio (CBA) for $904 million. The acquisition reflects growing strategic interest in low-carbon aluminium as producers realign supply chains amid energy transition policies.
Under the agreement, the partners will acquire a 68.6% stake, or 446.6 million shares, from Brazilian conglomerate Grupo Votorantim at $2 per share. The offer carries a modest 1.4% premium to CBA’s previous closing price. The buyers will also launch a mandatory tender offer for the remaining shares, a move that could lead to CBA’s delisting from Brazil’s B3 exchange.
Market participants described the transaction as structurally bullish for aluminium. “Chinese producers are investing overseas because growth opportunities at home remain limited,” a Sydney-based analyst said. “That constraint reduces the risk of oversupply and supports long-term aluminium prices.”
CBA operates an integrated, low-carbon aluminium value chain spanning bauxite mining, alumina refining, and smelting. It also produces a range of primary aluminium products. Such assets are drawing strong interest as governments tighten carbon-linked procurement rules and advance border adjustment mechanisms.
For Rio Tinto, which is also evaluating a potential tie-up with Glencore, the deal is unlikely to materially affect near-term earnings. However, it strengthens the company’s exposure to low-carbon aluminium, a segment expected to command pricing premiums over conventional metal. The stake will be managed through a joint venture, with Chinalco holding 67% and Rio Tinto 33%.
CBA shares have more than doubled over the past 12 months. Its market capitalisation now stands at $1.27 billion, highlighting strong investor appetite for decarbonised aluminium producers.
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