Chinalco is set to participate in Rio Tinto’s rights issue, maintaining its stake in the miner just one month after the Chinese group walked away from a deal that would have seen it invest $19.5bn in return for holdings in nine of Rio’s mining assets.

People close to Chinalco say the state-owned group has exercised its full rights in the issue, keeping its ownership stake in Rio at the current size of 9 per cent – still well below the 19 per cent it would have risen to under last month’s aborted capital injection plan.

The rights issue closed at 11am London time on Wednesday, and Chinalco is expected to make a full announcement confirming its take-up of the shares today.

Rio is offering investors 21 shares for every 40 they hold at £14 a share in what is one of the largest rights issues on record, set to raise $15.2bn in total. The price is a substantial discount to the £60 a share paid when Chinalco bought its stake in Rio Tinto in a “dawn raid” on the group in late January 2008.

“I think initially when the deal was announced, people did wonder if Chinalco would subscribe, but when you remember the price that Chinalco bought their original stake in Rio at, the option of taking up rights at £14 would surely have seemed attractive to them,” said Rebecca O’Dwyer at Investec.

The Anglo-Australian miner is currently struggling with its debt pile and needs to repay $18bn in debt from its 2007 purchase of Canadian miner Alcan. Approximately $8.9bn is due by the end of this year, with a further $9.1bn due in 2010.

The rights issue was conceived after the failure of the Chinalco capital injection plan, and is running concurrently with Rio Tinto’s plans to merge its iron ore mining business in Western Australia with those of its rival BHP Billiton, which has adjacent operations in the area.

This joint venture plan is expected to raise $10bn in annual savings, although China has said it may use its antitrust laws to try to block the deal.

Shares in Rio Tinto closed up rose 2.5 per cent or 53p to £21.58 on Wednesday.