said it will receive $1.02 billion as it exits an agreement with
Aluminum Corp. of China
, or Chinalco, to purchase shares in miner
Alcoa, which took a stake in Rio Tinto last year, will receive the cash in three installments over six months ending July 31, the company said in a statement Thursday following news that
. The stake is worth reportedly about $300 million at current prices.
Alcoa said the transaction will improve its cash position and positively impact its debt-to-capital ratio. Alcoa will record a noncash after-tax loss of about $120 million on the investment in the first quarter of 2009.
Alcoa and Chinalco also announced Thursday they intend to explore opportunities to expand their commercial relationship through strategic ventures.
"This transaction, combined with our intention to explore opportunities to expand our commercial relationship, strengthens Alcoa's ability to weather the economic downturn," said Klaus Kleinfeld, Alcoa president and CEO. "When the global economy recovers, the pent-up consumer and industrial demand will create a broad array of opportunities in both developed and developing regions for Chinalco and Alcoa."