Aluminum Corp of China (Chalco) has agreed to buy a 51 per cent stake in smaller rival Gansu-based Hualu Aluminum for 270 million yuan, its fourth acquisition in four months, as it boosts its smelting capacity and consolidates its leadership in the fragmented industry. Chalco, China's largest aluminium smelter and the world's second-largest producer of alumina, a raw material in aluminium production, will buy the stake from Baiyin Nonferrous and Baiyin Honglu Aluminum, the firm said yesterday. The remaining 49 per cent equity interest will be held by Baiyin Honglu. As of December 31 last year, Hualu had audited net assets of 529 million yuan. Chalco aims to double its aluminium smelting capacity to three million tonnes this year, matching a similar gain last year, mainly through acquisitions. The latest purchase would add 127,000 tonnes to Chalco's annual aluminium smelting capacity. The purchase follows Chalco's acquisition last month of a 55 per cent stake in Huayu Aluminum and Power in Shandong for 412 million yuan which gave it annual smelting capacity of 100,000 tonnes. In June, Chalco paid 219 million yuan for 66.4 per cent of Zunyi Aluminum in Guizhou which has annual capacity 113,000 tonnes. In May, the firm paid 247 million yuan for 29 per cent of Jiaozuo Wanfang Aluminum Manufacturing which can produce 200,000 tonnes of aluminium a year. Last week, Chalco cut it domestic alumina prices 13.3 per cent from 5,650 yuan a tonne to 4,900 yuan effective August 7 following a steep fall in spot alumina prices. Chalco has a near-monopoly of China's alumina business, though ABN Amro says in a report new entrants will account for 60 per cent to 80 per cent of new capacity coming on stream between now and 2008, cutting Chalco's market share to 60 per cent. The stock closed at HK$5.16 yesterday, down 29 per cent from the HK$7.25 it fetched in a May share placement that raised HK$4.35 billion for its acquisitions war chest.