Alcoa, Vietnam exploring joint venture projects

Aluminum producer Alcoa Inc. said Tuesday it is considering taking a minority stake in a prospective Vietnamese bauxite mine and alumina refinery.

Alumina, which comes from bauxite, is processed into aluminum.

Under terms of a cooperation agreement Alcoa signed with state-owned Vietnam National Coal-Mineral Industries Group, a subsidiary of the U.S. company will conduct due diligence on buying a 40 percent stake in the proposed 600,000 metric ton per year Nhan Co. alumina refinery to be built in Dak Nong province.

If the transaction proceeds, the Nhan Co. mine and refinery parent company will be 51 percent owned by the government and 40 percent owned by Alcoa World Alumina and Chemicals, an alliance between Alcoa and Alumina Ltd. in which Alcoa holds a 60 percent stake.

Other investors will own the remaining 9 percent share of Nhan Co.'s parent company.

Further, the parties to the cooperation agreement plan a joint feasibility study on another prospective bauxite mine and alumina refinery project, with first-stage annual capacity expected to be between 1 and 1.5 million metric tons of alumina.

Financial terms of the agreements were not disclosed.

Shares of Alcoa fell 13 cents to $37.58 in afternoon trading.