But with the global financial chaos gathering force and international commodity prices in a freefall, Rio Tinto's assets are no longer desirable for many other mining companies. Its latest annual financial report shows its net profit was nearly halved in 2008.

The company is also carrying an enormous $39-billion debt load that has put a damper on its value. Rio Tinto, which took on the debt when it bought Canadian aluminum company Alcan Inc. in 2007, has $19 billion coming due in two years. The company has been under pressure to shed jobs and close several factories to honor its previous pledge of paying off $10 billion of its debt this year. This was also a reason why BHP Billiton officially bowed out of a pursuit for Rio Tinto last November.

Joining hands with Chinalco was the best way for the Rio Tinto to prop up its battered balance sheet and lay solid ground for future cooperation with China, said Paul Skinner, the company's chairman, in a statement. Rio Tinto's board unanimously approved Chinalco's capital injection.

Not yet a done deal

Chinalco's latest deal with Rio Tinto still needs to be approved by a majority of the Australian miner's shareholders and relevant authorities, including Australia's Foreign Investment Review Board (FIRB), which has closely scrutinized investments by Chinese companies.

Shortly after the deal was announced, the FIRB vowed to tighten its foreign ownership laws in a move that reflected its deep concerns about a China foothold in the continent's prime assets. Last year, the regulatory body also delayed for three months the Chinese steelmaker Sinosteel Corp.'s application to raise its stake in the Australian iron ore miner Murchison Metals Ltd.

Australia's doors are open to all foreign investments, including those from China, that recognize the underlying strengths of the Australian economy, but they must mesh with national interests, said Australian Federal Treasurer Wayne Swan in a recent meeting with Lou Jiwei, Chairman of China Investment Corp.

"We will take a close look at the proposal and make a decision in national interests," Swan said about Chinalco's proposed investment in Rio Tinto.

The FIRB has not been the only one standing in the way of the transaction. Some Rio Tinto shareholders have reportedly expressed worries that the Chinese offer has discounted the underlying value of Rio Tinto's best assets at a market bottom and that the growing influence of Chinalco in the company may spark conflicts of interests.

But financial analysts still believe the investment is very likely to get a green light from the FIRB and a majority of shareholders. They said the deal would probably go through because having a partner would help Rio Tinto ride out the financial freeze, and the Chinese appear to have no intention of grabbing control of any of its key operations. Moreover, it could help the group make inroads into China and other emerging markets, they said.

Rio Tinto's board of directors also has been trying to convince wary shareholders and sensitive authorities about the deal's merits, said Anthony Loo, Managing Director of Rio Tinto China, in a statement. A closer relationship with Chinalco would absolutely serve the company's interests and meet the FIRB's requirements, he said.

Rio Tinto shareholders will vote on the deal in May or June, but before that time, its archrival BHP Billiton could launch a counter-bid for some of its resources assets, complicating Chinalco's offer. But analysts said BHP Billiton would have to match the premium package proposed by the Chinese aluminum maker. In the meantime, BHP Billiton has voiced its opposition to the Chinese investment, but has declined to reveal its next step.

Blessing or curse?

Although the fate of the deal remains up in the air, an unavoidable question has come into focus: Will it pay for Chinalco to pour money into a debt-laden company in a collapsing sector? Some analysts have raised concerns that Chinalco is repeating its last misstep while it seeks to build a presence in Australia. Last February, the Chinese company paid a whopping $14 billion for its 9-percent stake in Rio Tinto, which has shrunk by around 60 percent in value after Rio Tinto's share price fell to $21 last November 25.

"Now with global commodity prices bound for a downward spiral, the new asset purchase may incur more paper losses," said Yang Baofeng, a mining analyst at the Orient Securities Co. Ltd. in Shanghai, in a report. "It's not a safe deal for Chinalco to have a stake in the Western economy that is succumbing to a sharp recession."