Amcor bids for parts of Rio Tinto's Alcan branch

Australian packaging firm Amcor on Tuesday launched a 2.025 billion US dollar takeover offer for parts of resources giant Rio Tinto's Alcan business.

Amcor said it had offered to buy four Alcan Packaging divisions, part of a range of assets Rio Tinto has put on the market as it seeks to reduce its debts.

Amcor said the targeted businesses complemented its existing operations and would make it one of the world's largest packaging companies.

"Now is the time in the economic cycle to be making acquisitions as asset values are substantially lower than they have been for many years," chief executive Ken MacKenzie said.

The divisions Amcor wants to buy are Alcan's global tobacco and pharmaceuticals divisions and its food packaging arms in Asia and Europe.

Rio Tinto said the businesses had 14,000 employees in 28 countries and generated revenues of 4.1 billion US dollars in 2008.

"We believe Amcor's offer is in the interests of all stakeholders," Rio's chief financial officer Guy Elliott said.

Rio borrowed heavily to fund its 38.1 billion US dollar takeover of Canadian aluminium group Alcan in 2007 and the miner is selling non-core assets to reduce its debt burden.

Elliott said Rio had already agreed asset sales of 6.6 billion US dollars over the past 18 months, including last month's sale of Alcan's American food packaging arm to US firm Bemis for 1.2 billion.

Amcor said subject to regulatory and shareholder approval, the deal could be completed by the end of September.