Sure, why wouldn’t Australia approve of Chinalco’s (NYSE:ACH) stake in Rio Tinto (RTP)? Australia’s wealth has grown like a weed thanks to its biggest customer, China, and China’s buying of Australia’s commodities. So why not play buddy buddy with your biggest customer? Sure, other “developing countries” are growing too … and while this might sound awkward referring to a communist country like China, China’s actually good for its money.
You don’t just want a customer that pays, but pays steadily and that you know is good for it. Some of the politically unstable countries? I dunno. Countries (well country, i.e. U.S.A.) with debt growing like a tumor? Not too sure either. But China, a country that’s growing fast and steadily and strategizing around the world (such as with African nations) to secure its future growth, and with national reserves growing up the wazoojust on interest alone? Yeah, I’d play buddy buddy with China too. It’s like in the old days how a king would send over his sister or daughter to marry another country’s royalty. In this case, I guess the princess’ name is Rio Tinto. But then eventually (well, after a year or so) the two kingdoms would be at war again and the sacrificial princess would be killed. Let’s see how this modern remake plays out!
Australia approves Chinalco stake in Rio Tinto
SYDNEY (Reuters) - Australia has approved Chinese aluminum giant Chinalco’s recent purchase of a minority stake in Anglo-Australian miner Rio Tinto but warned the Chinese firm against buying more shares without prior approval.
State-owned Aluminum Corp of China (Chinalco), backed by U.S. peer Alcoa Inc (NYSE:AA), began amassing shares this year with the aim of taking up to 14.9 percent of Rio, the target of a $127 billion takeover bid from rival BHP Billiton (NYSE:BHP).
Full Article: Australia approves Chinalco stake in Rio Tinto