Rio Tinto (LON, ASX:RIO) is selling its Pacific Aluminum business ¨C a group of smelters in Australia and New Zealand ¨C in a deal potentially valued at $1 billion, the Financial Times reported on Sunday, citing people familiar with the Anglo-Australian mega-miner's plans.

According to the FT, Rio Tinto has engaged Credit Suisse to find a buyer for its Pacific aluminum assets, which it has tried to sell before but stopped in 2013 due to a lack of interest in the money-losing operations. However a rebound in the price of aluminum, which is now trading at $US 0.84 a pound, has raised the potential value of the assets, presaging a renewed inducement to sell.

"Rio wants to shed its higher-cost aluminium assets, concentrating on its lowest-cost smelters as well as on the mining of bauxite, the raw material used to produce alumina, which is then processed into aluminium," the financial newspaper reported.

Followers of the aluminum market will recall Rio Tinto's disastrous purchase of Alcan, the Canadian aluminum smelter, in 2007. The buyout came at the top of the mining cycle and Rio Tinto paid a 65 percent premium for the asset, only to find the aluminum market soon flooded with cheap supply from China. Saddled with debt, the deal hampered Rio Tinto's ability to make subsequent purchases.

In March, Rio announced hundreds of job cuts at its Australian coal and iron ore operations, as well as around the globe, as the company embarks on an internal restructuring considered one of the most aggressive since CEO Sam Walsh took the helm in 2012.