Rio Tinto Receives $500 Million Offer for Smelter in France

Rio Tinto is set to sell its French Aluminium Dunkerque smelter for $US500 million

Rio Tinto is set to sell its French Aluminium Dunkerque smelter for $US500 million

Continuing a recent spending spree, GFG's industrial arm Liberty House made a binding conditional offer to buy Aluminium Dunkerque from Rio Tinto, which it said was part of a major expansion into continental Europe.

The Liberty House proposal includes plans to modernise the site, according to Rio.

The deal is subject to a statutory consultation with employees, the European Works Council and stakeholders and is expected to be completed in the second quarter of 2018. "Our detailed analysis leads us to believe that Dunkerque is the best location to drive forward our downstream automotive strategy".

"Aluminium Dunkerque has a high-quality aluminum operation benefitting from a top-class workforce and management. This will be our key strength when embarking on our ambitious plans", he said in a statement.

He added that GFG wants to develop the Dunkerque smelter into an global centre of aluminium expertise, using its GREENALUMINIUM strategy, which is based on its GREENSTEEL strategy to reduce the carbon footprint of production, make processes more sustainable, use more innovative technologies, and be more flexible to customer demand.

Rio Tinto Chief Executive Jean-Sebastien Jacques, who took charge in July 2016, is moving to divest all but the company's best-performing units.

In a nod to economic policies pursued by French President Emmanuel Macron's government, Gupta said: "We are particularly attracted by the pro-business environment that President Macron's France is quickly building".

Reuters first reported last December that Liberty House was considering a bid for the smelter, with sources valuing it at around 200 million euros.