Chalco boosts profits, announces 16 bln yuan external investment plan (updated)

Accendra Health

26/10/2017 16:01

(Adds details) 
    BEIJING, Oct 26 (Reuters) - Aluminum Corp of China Ltd 
 601600.SS  2600.HK  ACH.N  announced a plan on Thursday to 
bring up to 16 billion yuan ($2.41 billion) of investment into 
five of its subsidiaries after posting a more than 10-fold rise 
in nine-month net profit. 
    Chalco, the listed arm of China's biggest state-run 
aluminium firm Chinalco, said its net profit for the 
January-September period rose to 1.36 billion yuan from 124.27 
million yuan a year earlier, boosted by soaring aluminium 
prices. 
    Nine-month revenues were up 52.5 pct at 139.9 billion yuan, 
the company said. 
    Chalco plans to bring in external investors to invest up to 
a total of 16 billion yuan in five of its subsidiaries, it said 
in a separate stock exchange filing. 
    The units, all currently 100 percent owned by Chalco, were 
named as Chalco Shandong, Chalco Zhongzhou Aluminum Co., Baotou 
Aluminum Co, Chalco Mining and Chalco Gansu Aluminum Electricity 
Co.  
    Chalco Shandong and Zhongzhou Aluminum both produce alumina, 
according to the filing, while Chalco Mining's activities 
include bauxite mining. Both substances are raw materials for 
aluminium production.  
    "At present, the company is implementing the relevant 
decision-making procedures and has not yet entered into any 
formal agreement with investors," Chalco said, adding that it 
would continue to have "substantial control" over the 
subsidiaries after the external investment. 
    It gave no indication of who the third-party investors 
making the capital contribution would be, but said their 
investment would not constitute a material asset restructuring 
under Chinese securities regulations. 
    In another statement, Chalco said it would transfer a 60 
percent interest in another wholly owned unit, Chalco Shandong 
Engineering Technology, to China Aluminum International 
Engineering Corporation Ltd, a subsidiary of its parent. 
    The announcements appear to partly clarify why trading in 
Chalco's Shanghai shares has been suspended since Sept. 12, 
pending a major plan.  urn:newsml:reuters.com:*:nL4N1LT18G 
    Earlier this week, Chalco said the plan "involves issuance 
of shares for purchase of assets" and that the target assets 
"were preliminarily determined to be certain equity interests of 
the company's subsidiaries." 
    Chalco's Hong Kong-traded shares are up more than 100 
percent year-to-date as the company reaps the rewards of higher 
aluminium prices, which have risen by some 20 percent on the 
Shanghai Futures Exchange so far this year.  
    Separately, Chalco said it had agreed to raise the caps on 
financial services provided by Chinalco Finance. Under the new 
agreement, the maximum total daily balance of loans provided to 
Chalco is raised from 10 billion yuan to 15 billion yuan. 
  
($1 = 6.6340 Chinese yuan renminbi) 
 
 (Reporting by Tom Daly and Meg Shen; Editing by Lee Chyen Yee 
and Adrian Croft) 
 ((tom.daly@thomsonreuters.com;)) 
 
Keywords: CHALCO CHINA/RESULTS