China takes stake in Rio February 3rd, 2008
The Chinese state controlled Aluminium Corp of China (Chinalco) has paid £7bn for a 9% stake in in the Rio Tinto Group. This equates to £60 per share which is 20% higher than the £50 per share offer from BHP Billiton. The invetment is the largest deal to date by a Chinese corporation in a foreign business.
The deal represents a strategic move by China, as it has few natural resources of its own, yet has a great demand for such resources given the rapid and continuous development of the country.
