By staff reporter Yan Jiangning

The Aluminum Corporation of China (Chinalco) has won the approval from Australian government to purchase Australian miner Rio Tinto's London-listed shares.

Australia's Federal Treasurer Wayne Swan said August 24 that the government would permit Chinalco, China's largest aluminum producer, to buy up to 14.99 percent of the shares in Rio Tinto PLC, the arm of Rio Tinto Group listed on the London Stock Exchange.

The shares would equate to an 11-percent stake in the mining company's combined Australian and London equities.

The Rio Tinto purchase has been long in the making. On January 31, Chinalco, allied with the Aluminum Company of America (Alcoa), announced plans to buy 12 percent of Rio Tinto's London-listed shares for US＄ 14 billion. The acquisition would have given the company a 9-percent stake of Rio Tinto Group.

However, the original deal didn’t receive approval from the Australian treasury. Facing concerns over foreign investment in the country's resources industry, Australian Prime Minister Kevin Rudd said February 5 that the government was examining the deal according to "national interest."

According to Treasurer Swan, the deal is finally approved on the condition that Chinalco not to raise its share in Rio Tinto PLC above 14.99 percent. Moreover, Chinalco also agreed not to seek board representation in Rio Tinto as long as its holdings were below 15 percent.

"I have determined that the undertakings agreed upon with Chinalco are acceptable for protecting the national interest in this matter," said Swan. He added that if Chinalco wants to further increase its share in Rio Tinto, it must submit new application to the government and wait for assessment according to Australia's Foreign Acquisition and Takeovers Acts.

In an August 9 interview with Caijing, Rio Tinto CEO Tom Albanese said he would be glad to see Chinalco increase its stake in Rio Tinto, which he believed would show "shareholder’s confidence of on Rio Tinto."