BHP and Rio kicking Alcan’s tires?

Rumours are abounding that BHP Billiton (BHP-N,BLT-L) and Rio Tinto (RTPN,RIO-L) are mulling over a bid for Alcan (AL-T).

The Globe and Mail quotes an unnamed investment banker who speculates that a friendly takeover could be in the works friendly because a hostile takeover could jeopardize Alcan’s sweetheart energy deal with the Quebec government.

The source told the Globe that neither BHP nor Rio is interested in Alcan’s packaging business, and would sell-off those assets in the event of a takeover.

“It’s pure speculation and I can’t comment,” Anik Michaud, spokeswoman for Alcan told Reuters of the Globe and Mail article. Rumours of a Rio takeover of Alcan have also surfaced in Australian media outlets.

Montreal-based Alcan is the world’s second-largest aluminum maker. The threat of a labour strike at the world largest aluminum producer, Alcoa (AA-N), has fuelled speculation that aluminum prices could be on the rise in the near future.

A market note from Canaccord Capital issued on May 31 says Rio sees Alcan’s metals and alumina operations as a good strategic fit.

“Rio currently lacks scale in this marketplace…and is also likely under pressure to do a deal and keep pace with the likes of BHP and Xstrata,” the note says.

Canaccord also points out that Rio’s shares have significantly outperformed Alcan’s.

While Alcan’s share price it was trading at $57.60 in Toronto on May 31 — is lower than it was five years ago, Rio’s shares trading at US$221.82 in New York on May 31 have almost tripled in that time period.

BHP was trading at US$43.28 in New York on May 31.