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Chinalco freeze on £255m bonds
Nick Goodway, Evening Standard17 Oct 2008
China's biggest aluminium group, Chinalco, today suspended a three billion yuan (£254.9 million) bond issue as doubts grew over its $8 billion (£4.61 billion) stake in Anglo-Australian miner Rio Tinto.
Chinalco's Rio stake was held in the London arm of collapsed investment bank Lehman Brothers. Chinalco denied reports of talks with Lehman liquidators in Hong Kong.
It said: “There is no basis on which Chinalco's ownership of the shares could be validly challenged or ... form part of the general assets of Lehman.”
Chinalco , acting with Alcoa of the US, bought a 12% stake in Rio this year for more than $14 billion in a bid to gain some control of global aluminium and iron ore reserves.
Today Chinalco said it was suspending five-year bills because it had to clarify rumours that could affect investors' behaviour.
Lehman's administrator in London has said it could take months to disentangle its finances before it starts returning assets to their owners.
