Corus puts aluminium unit on block

STEEL giant Corus rejoins the blue-chip FTSE 100 today. It will also report a loss of around £450m for 2001 and announce the proposed sale of its aluminium operations, which could fetch up to £1bn.

Chief executive Tony Pedder is desperate to slash debt of around £1.5bn. He has hired Credit Suisse First Boston to handle the sale of one of the few profitable parts of the group. The aluminium interests were part of Hoogovens, the Dutch metals group with which British Steel merged to become Corus. Canadian group, Alcan, Norsk Hydro of Norway and Sweden's Sapa are potential bidders.

Corus's decision to sell comes at a time when analysts forecast aluminium volumes will suffer in 2002. A softening German construction market is set to depress margins at the extrusions business in continental Europe, while the aluminium plate business will suffer from a decline in orders from the aerospace sector. The outlook for Corus remains uncertain following America's recent decision to impose tariffs of 30% on imported steel.