ALUMINUM Corp. of China Ltd. (Chalco) will pay shareholders a premium to buy their stock in its Hong Kong-listed unit Chinalco Mining Corp. International as it moves to take the division private.

    The HK$1.39 (18 U.S. cents) per share offer is a 32.4 percent premium to the unit’s closing price of HK$1.05 Sept. 14, its last trading day, or 33.7 percent more than the average price over the last 30 trading days, the country biggest State-owned aluminum producer said.

    The stock, suspended since Sept. 15, resumed trading yesterday.

    The move to privatize Chinalco Mining Corp. International will make it easier for Chalco to raise funds for its unit’s Toromocho copper mine in Peru, which started operations in December 2013.

    The mine has had its revenue squeezed by falling copper prices, inefficient operations and sporadic worker strikes.

    Copper prices on the London Metal Exchange dropped 43 percent from January 2013, when Chinalco Mining Corp. International (CMC) started trading in Hong Kong, to Sept. 14, according to Chalco.

    “This has had a negative impact on the trading prices of CMC shares, and has also decreased the ability of CMC to raise equity funding for operations,” Chalco said.

    CMC approved a US$1.32 billion expansion for the Toromocho project in June 2013 to improve operational efficiency.

    “However, as at the announcement date, a substantial part of such future capital expenditure remains unfunded,” according to the statement.

    By privatizing CMC, Chalco will be able to exercise “greater flexibility in reorganizing the capital structure of CMC and in increasing funding to CMC,” according to the statement. (SD-Agencies)