TORONTO (miningweekly.com) – Resources giant Rio Tinto has agreed to sell a 56% stake in its Alcan Engineered Products' Cable division to Los Angeles-based Platinum Equity, the group revealed on Monday.

The terms of the sale are confidential, and the deal is expected to close in “several weeks”, Rio said.

The Cable business manufactures aluminium energy cable products and has seven production sites in the US, Canada and China.

"This is the first time we have entered an agreement with a private equity partner and we look forward to working with them,” Rio Tinto CFO Guy Elliott said in a statement.

“This offers a good solution to Rio Tinto as we will be able to step back from day-to-day management of the business but retain an economic interest in its recovery as market conditions improve."

Rio has been divesting assets to ease the large levels of debt it took on to fund the acquisition of Canada's Alcan, in 2007.

Last month, the group said it agreed to sell the majority of the Alcan packaging businesses for $2,03-billion, to Australian firm Amcor.

Also in 2009, Rio has sold its interest in the Ningxia aluminium smelter in China for $125-million, its potash assets and Brazilian iron-ore operations for $1,6-billion and its Jacobs Ranch coal mine in the US for $761-million, as well as the Alcan Packaging Food Americas unit to Bemis.

Platinum Equity specialises in the merger, acquisition and operations of companies that provide services and solutions to customers in a broad range of business markets, including information technology, telecommunications, logistics, metals services, manufacturing and distribution.

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.