Rio Tinto completes eventful week by announcing the sale of its Alcan Packaging Food division.

Rio Tinto has sold its Alcan Packaging Food Americas division to Bemis Company for $1.2 billion (£793.3m), in a move designed to raise capital and reduce its asset portfolio.

The Food Americas division, with its headquarters in Chicago, employs approximately 4,600 people at 23 locations across the world and in 2008 generated approximately $1.5bn.

The company had previously announced its plans to sell $3.7bn of assets as it looks to reduce the $38bn of debt it took on to buy the Canadian aluminium group Alcan in 2007.

Bemis Company is a major supplier of flexible packaging and pressure sensitive materials used by leading food, consumer products, manufacturing and other companies worldwide.

Guy Elliott, Chief Financial Officer said: “The sale of the Food Americas division is the first significant step in reducing the asset portfolio acquired with Alcan.

“The transaction represents solid value given the challenging financial environment. We believe this is a positive outcome for Food Americas as it is a good fit with Bemis’s business and stands to benefit from an excellent platform for growth and development in the regional food sectors in the Americas.”

The news follows the announcement last week that the company had received applications for 142,149,887 new Rio Tinto shares, or approximately 95% of the total number of shares it had offered in its rights issue, which aimed to raise $15.2bn.

The sale is subject to satisfactory approvals.