Australian reports say Rio Tinto may bid for Alcan

SYDNEY, Australia - Rio Tinto PLC may be considering a US$27-billion bid for Canada's Alcan, an Australian newspaper reports.

But analysts played down the benefits of a linkup between the two global companies.

The Sydney Morning Herald reports, without citing sources, that Rio Tinto has hired Deutsche Bank to advise it on a possible bid for Alcan.

Alcan's board urged shareholders to reject a hostile $27-billion cash-and-shares offer from U.S. competitor Alcoa on the grounds it was too low and completion of the merger was too uncertain due to regulatory and other hurdles.

Rio Tinto and Deutsche Bank declined comment on the report, calling it speculative.

Analysts downplayed the chances of a tilt by Rio Tinto for Alcan, pointing to limited synergies with the Canadian company's assets.