Alcoa Inc (AA) is exploring strategic partnerships with Aluminum Corp. of China, or Chinalco as the company gives up its stake in Rio Tinto PLC (RTP) for significantly more than it is currently worth.

The U.S. producer, which took a stake in Rio Tinto just over a year-ago, will get $1.021 billion in cash for the interest by July, it said Thursday. At current market prices, the stake is worth around $300 million.

Strategic partnerships may include greenfield projects as well as investment in existing operations and acquisitions, Alcoa spokesman Kevin Lowery told Dow Jones Newswires.

The move comes as Rio Tinto announces a proposed $19.5 billion strategic partnership with Chinalco that includes a $7.2 billion convertible bond issue and $12.3 billion in asset sales across Rio's aluminum, copper and iron ore business.

-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413; andrea.hotter@dowjones.com