Glencore Plc and Hillhouse Investment Management plan to invest in Chuangxin Industries Holdings Ltd’s upcoming initial public offering in the Hong Kong Special Administrative Region. Their participation signals confidence in the Chinese aluminum smelter as aluminum prices continue to rise.

Glencore and Hillhouse are expected to join as cornerstone investors, a role that guarantees share allocation in exchange for a lock-up commitment. China Hongqiao Group Ltd, China’s largest private aluminum producer, is also set to participate. Together with other cornerstone investors, they may purchase about half of the roughly US$700 million deal.

Chuangxin, based in Inner Mongolia, plans to begin taking investor orders by this week. China’s smelters, responsible for half of global primary aluminum output, have seen stronger profitability supported by demand from the renewable energy sector and recent multi-year highs in London Metal Exchange prices.