Citic buys 13% stake in Alumina

China’s state-owned Citic Group will pay A$452 million $468 million for a 13% minority stake in Australia’s Alumina. The move signals its expectation of an upturn in aluminium prices and reflects China’s increasing dependence on alumina imports.

Citic Resources intends to buy a 7.8% stake and its parent company Citic Group will purchase a 5.2% interest through a 366 million share placement, according to a statement by Alumina on Thursday. The placement at A$1.235 a share represented a 3% premium on Wednesday’s closing price.

Alumina shares surged as much as 17% on the news, as the injection of funds will allow the Australian company to reduce its...