March 12 (Reuters) - Australia's Alumina Limited ( AWCMF )

said on Tuesday it has agreed to be acquired by U.S.

aluminium producer Alcoa ( AA ) for a $2.2 billion all-stock

buyout offer.

The terms of the deal are consistent with Alcoa's ( AA ) offer for

Alumina announced on Feb. 26, when Alcoa's ( AA ) CEO William Oplinger

told analysts the deal would eliminate Alumina's overhead costs

of A$12 million ($7.93 million) a year.

Under the deal, Alumina shareholders would receive a

consideration of 0.02854 Alcoa ( AA ) shares for each Alumina share

they hold, implying a value of A$1.15 per Alumina share, based

on Alcoa's ( AA ) closing price as of Feb. 23.

Once the deal closes, Alumina shareholders on the date of

record will own about 31.6% of the merged entity, while existing

Alcoa ( AA ) shareholders will hold 68.4%.

Alumina's board, including its Managing Director and CEO,

recommend that shareholders vote in favour of the deal, in the

absence of a superior proposal.

Alumina's only asset is a 40% stake in the Alcoa World

Alumina and Chemicals joint venture, which is controlled by

Alcoa ( AA ) and has interests in bauxite mining, alumina refining and

aluminium smelting across Australia, Brazil, Spain, Saudi Arabia

and Guinea.

($1 = 1.5126 Australian dollars)