Rio Tinto chief leans towards Chinalco deal

Mr Leng, currently chairman of Corus, the UK steelmaker, dramatically quit the board of the Anglo-American mining group over the weekend less than a month after he was named a director and the chosen successor to chairman Paul Skinner, who was due to retire in April.

Rio is struggling with a net debt burden of $39bn, the result of its expensive acquisition of Canadian aluminium producer Alcan in 2007. The group has pledged to cut its debt by $10bn by the end of this year, and is looking at raising cash either through a rights issue or a two-part deal with Chinalco, the Chinese state-owned metals group, that could be valued at up to $20bn.

Rio said yesterday it had not yet decided which funding option to pursue: “All the various options are still being considered and the board's decision will be based on shareholder value.”

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