• Rio Tinto pumps US$700 million into deal for half of metal recycler
  • Boss Jakob Stausholm says it will help Rio deliver low emissions aluminium in market that will satisfy more than half of US demand by 2028
  • Lithium miners lead falls across ASX resources

 

Rio Tinto’s (ASX:RIO) CEO Jakob Stausholm has been telling investment bankers, hoping to get on its ticket for a mega deal, that he has no plans to blow the bank.

But RIO has been one of the most active majors in terms of pottering around the margins of its business, inking small deals to deliver incremental improvements in its variety of metal refineries and exploration initiatives.

Over the past couple weeks the focus has been squarely on Rio’s lithium ambitions, with the global resources giant making deals to explore via farm-ins with TSX-listed juniors in Canada’s James Bay province and in WA through an exploration agreement with Everest Metals Corp (ASX:EMC).

Today the news is a US$700 million offer to take a 50% stake in metal manager Giampaolo Group’s Matalco business.

Serious coin for anyone other than Rio and its rival BHP (ASX:BHP), who can basically fund this sort of thing through petty cash.

What Matalco does is operate six plants in the US and one in Canada which turn out 900,000t of recycled aluminium each year.

It also fits in with Rio’s plan to provide low carbon aluminium, with recycled aluminium expected to fill more than half of the US order book by 2028.

“Investing in recycling is part of our drive to find better ways to deliver the low-carbon materials the world needs and provides a natural extension of our industry leading primary aluminium business,” Stausholm said.

“We look forward to providing customers with aluminium solutions that meet heir needs for low-carbon primary and recycled materials in partnership with Giampaolo Group a leader in providing recycled material in North America.”

It comes just weeks after the announcement of a $1.1b investment for Rio to expand the use of its AP60 technology at the Arvida smelter.

 

Lithium stocks tank as miners weigh down ASX

Mining stocks have pulled the ASX into the red, sagging 1.41% on a rough day for the materials sector.

Lithium plays Sayona Mining (ASX:SYA) and Core Lithium (ASX:CXO) were among the most sold off stocks today. The latter copped a 17.24% spanking on the news that its Finniss lithium mine in the NT will produce around half of the volumes promised in a 2021 feasibility study through its first two years of operations in FY24 and FY25.

Among the large caps all the hardest hit miners were lithium stocks, which followed a sector selldown in the US on Friday.

Pilbara Minerals (ASX:PLS), due to release its fourth quarter production report this evening, fell 5.75%, while Allkem (ASX:AKE) was down 5.58%, IGO (ASX:IGO) dropped 4.04%, Liontown (ASX:LTR) dropped 3.867%.

Bulks were almost as leaky, with South32 (ASX:S32) down 2.62% after announcing an impairment on its Hermosa zinc-lead-silver project in Arizona and the big three Pilbara iron ore miners all fell more than 1%.

READ: Core smashed on guidance miss, South32 impairs US zinc project

 

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