In afternoon trade the Rio Tinto Limited (ASX: RIO) share price is following the market lower and is down 1% to $80.80.
Whilst this is disappointing for shareholders, it could be a buying opportunity for non-shareholders according to one leading broker.
A note out of UBS this week reveals that its analysts have retained their buy rating and $85.00 price target on the mining giant's shares after it advised that it has received an offer for its aluminium assets.
Norway-based Norsk Hydro has offered US$345 million to acquire Rio Tinto's ISAL smelter in Iceland, its 53.3% share in the Aluchemie anode plant in the Netherlands, and its 50% share in the Aluminium fluoride plant in Sweden.
While there are conditions that need to be satisfied, management appears confident that it will close the deal in the second quarter of 2018.
UBS appears confident too and predicts that most of the funds received will be returned to shareholders.
This is on top of its existing buyback programme which is for a maximum consideration of up to US$2.625 billion and is set to run until December 31 2018.
Incidentally, the broker also has a buy rating and $33.50 price target on the shares of industry peer BHP Billiton Limited (ASX: BHP).
