PROSPECTUS   
	
 
	
 
	

	 Dividend Reinvestment
	Plan  
	

	 for Shareholders of  
	

	 Alcan Inc.  
	
  
	

	
	
 
	
We are offering to holders of our Common Shares the
	right to participate in the following plan:
	
		
			
			
Dividend Reinvestment Plan
			
			
You may elect to have your cash dividends
			reinvested in our Common Shares at market value.
		
	
	
 
	
 
	

	_______________
	
 
	
 
	
 
	
No securities
	commission or similar authority in Canada has, in any way, passed upon the
	merits of the securities offered hereby and any representation to the
	contrary is an offense.
	
Neither the Securities
	and Exchange Commission nor any state securities commission in the United
	States has approved or disapproved of the Common Shares to be issued under
	the Dividend Reinvestment Plan or passed upon the accuracy or adequacy of
	this prospectus.  Any representation to the contrary is a criminal offense.
	
 
	
 
	

		

		The date of this prospectus is January 1, 2007.

		 

		

		 





  

	
CONTENTS
	
		
			
			
 
			
			

			Page
		
		
			
			
Alcan Inc.
			
			

			3
		
		
			
			
Dividend Reinvestment Plan
			
			

			3
		
		
			
			
How Can I Participate?
			
			

			5
		
		
			
			
Tax Consequences
			
			

			6
		
		
			
			
Description of Share Capital
			
			

			8
		
		
			
			
Use of Proceeds
			
			

			10
		
		
			
			
Legal Matters
			
			

			10
		
		
			
			

			Experts
			
			

			10
		
		
			
			

			Indemnification
			
			

			10
		
		
			
			
Where You Can Find More Information
			
			

			11
		
		
			
			
 
			
			
 
		
	
	
You should rely only on the information contained
	in this document or that we have referred you to.  
	
We are a Canadian corporation. A substantial
	portion of our assets are located in Canada and elsewhere outside the United
	States, and many of our Directors and executive officers, including many of
	the persons who signed the registration statement on Form S-3, of which this
	document is a part, and the experts named herein are resident outside the
	United States, and all or a substantial portion of the assets of our
	Directors and executive officers and the experts named herein are located
	outside the United States. As a result, it may be difficult for you to
	effect service of process within the United States upon our Directors and
	executive officers and the experts named herein and to enforce against them
	in the United States judgments of courts of the United States predicated
	upon, among other things, civil liability provisions of the federal
	Securities laws of the United States.  In addition, it may be difficult for
	you to enforce, in original actions brought in courts in jurisdictions
	located outside the United States, among other things, civil liabilities
	predicated upon the federal Securities laws of the United States.  Roy
	Millington, Corporate Secretary of Alcan Inc., our Canadian counsel has,
	however, advised that the civil liability provisions of the federal
	Securities laws of the United States may be enforced in original actions
	taken in the Province of Quebec against us or any of our Directors and
	executive officers and the experts named herein, but there is substantial
	doubt as to the enforceability in the Province of Quebec of judgments of
	United States courts obtained in actions predicated upon the federal
	Securities laws of the United States.
 
2







   
ALCAN INC.
We are a Canadian corporation
and the parent company of an international group involved in many aspects of the
aluminum, engineered products and packaging industries. Our activities include
bauxite mining, alumina refining, production of specialty alumina, aluminum
smelting, manufacturing and recycling, engineered products, flexible and
specialty packaging, as well as related research and development. For
more information, please visit: www.alcan.com.
 We were
incorporated on June 3, 1902 under the laws of Canada for an unlimited
duration.   Our principal executive offices are located at: 1188
Sherbrooke Street West, Montreal, Quebec, Canada H3A 3G2, telephone number
(514) 848 8000.

DIVIDEND REINVESTMENT PLAN
Overview
We are offering to holders of our Common Shares the right
to participate in the Dividend Reinvestment Plan.  We refer to the Dividend
Reinvestment Plan as the DRP.  If you elect to participate in the DRP, you can
elect to receive the dividends on some or all of the Common Shares you own in an
amount of newly-issued Common Shares equal to the market value of the average of
the closing prices of Common Shares during the last five trading days prior to
the dividend payment date, less any applicable withholding tax, instead of in
cash.  You may elect to participate in the DRP by meeting the eligibility
requirements below and by following the instructions in the section "How Can I
Participate?" beginning on p. 5.
Eligibility
To be eligible to participate in the DRP, you must
generally own Common Shares registered in your own name on our records.  It may
be the case that you hold your Common Shares in "street name", which means that
your Common Shares are held in a nominee account with an investment dealer such
as a broker, a bank or a trust company.  If you hold your Common Shares in
street name, you must transfer shares into your own name on our records to be
eligible to participate in the DRP or make other arrangements with your
investment dealer for your participation.
Participation
You may reinvest cash dividends, less any applicable
withholding tax, paid on all or a portion of your Common Shares in newly-issued
Common Shares. For example, if you own 125 Common Shares, you may decide to
participate in the DRP with respect to 70 Common Shares only and to continue to
receive cash dividends on the remaining 55 Common Shares in the usual manner.
Your participation commences on the first dividend record
date following receipt by CIBC Mellon Trust Company ("CIBC Mellon"), our
transfer agent, of the duly completed form enclosed with this prospectus.  The
dividend record date is the date set by the Board of Directors as the date for
determining the shareholders of record that are entitled to receive a dividend
on Common Shares.  The dividend record dates are usually established in
February, May, August and November of each year and are made public.
Once you are enrolled in the DRP, your participation will
continue automatically unless and until you terminate your participation in the
manner described under "Termination of Participation" below.  Following the
initial dividend record date, you will receive dividends in the form of
newly-issued Common Shares on both the Common Shares you elected to include in
the DRP. In other words, dividends on Common Shares acquired under
the DRP (including fractions of Common Shares), less any applicable withholding
tax, will be reinvested in further newly-issued Common Shares (including
fractions) together with the dividends on the Common Shares initially elected
for participation in the DRP.  Dividends, whether in the form of cash or
newly-issued Common Shares, are paid or issued on the dividend payment dates
following the applicable dividend record dates, which are usually established in
March, June, September and December of each year and are made public.
 
3
 

Change of election
To change a DRP election
already made, please write to CIBC Mellon giving details of the change desired. 
Any written notification received by CIBC Mellon prior to a dividend record date
will be effective on the next subsequent dividend payment date.
Determination of market
value and the number of Common Shares you will receive
For each Common Share you elect to include in the DRP,
you will receive the number of newly-issued Common Shares equal to the aggregate
cash dividend (less any applicable withholding tax) you would otherwise receive
divided by the market value of each Common Share on the dividend payment date. 
The market value is the average of the closing sale prices for board lots for
our Common Shares on The Toronto Stock Exchange and for round lots for our
Common Shares as reported on the New York Stock Exchange ― Consolidated Trading
on each day during the last five trading days on each exchange prior to the
relevant dividend payment date.
 
If your registered address is in Canada, the market value
is expressed in Canadian dollars and if your registered address is outside of
Canada, the market value is expressed in U.S. dollars.  If one of the stock
exchanges is closed for trading during these five trading days, different days
will be used to calculate the market value. Currency conversions will be made at
the Bank of Canada noon rates of exchange on each trading day.
Your account will be credited, as of each dividend
payment date, with the number of newly-issued Common Shares, including, if
applicable, fractions of Common Shares calculated to three decimal places, to
which you become entitled.
Statements of account
CIBC Mellon, on our behalf, will maintain an account for
you in respect of your Common Shares subject to the DRP and will mail a
statement of account to you at the end of each month in which a dividend payment
date occurs. This statement will record the cash dividends payable on the Common
Shares subject to the DRP, the taxes withheld, if applicable, the number of
newly-issued Common Shares (calculated to three decimal places) resulting from
reinvestment of the net cash dividends payable, the market price per Common
Share and the new total number of Common Shares (calculated to three decimal
places) credited to your account under the DRP. These statements should be
retained for tax purposes.
Certificates representing your Common Shares
You may at any time obtain a certificate for any number
of whole Common Shares in your DRP account that are not already represented by
an outstanding certificate, by written request to CIBC Mellon.
Voting of your Common Shares
You may vote each of the whole Common Shares credited to
your account under the DRP, in person or by proxy, at any meeting of
shareholders. A fractional Common Share does not carry any right to vote.
Sale or other transfer of shares
In order to sell or otherwise transfer Common Shares
credited to your account under the DRP, you must obtain from CIBC Mellon a
certificate representing your Common Shares. A certificate will only be issued
for a whole number of Common Shares - see "Certificates representing your Common
Shares" above.  We will not recognize a pledge of, or other encumbrance against,
the Common Shares credited to an account under the DRP for which a certificate
has not been issued.
If you transfer a portion of the Common Shares registered
in your name, through a sale or otherwise, such transfer will be deemed, in the
absence of written instructions to CIBC Mellon to the contrary, to have been
made first out of the Common Shares, if any, that are not subject to the DRP.
4
 

Termination of
participation
You may, at any time by written notice to CIBC Mellon,
terminate participation as to all or a portion of your Common Shares subject to
the DRP.  Any subsequent dividends payable on the Common Shares you withdraw
will be paid to you in cash.  Participation in the DRP will terminate
automatically upon receipt by CIBC Mellon of written notice of your death.
 
Upon termination, a certificate for the appropriate
number of whole Common Shares will be issued and mailed together with a cheque
for the proceeds of sale of any fraction of a Common Share.  If the notice is
received after a dividend record date, the termination is effective only after
the related dividend payment date.  In other words, the notice of termination
must be received by CIBC Mellon prior to a dividend record date to be effective
on the related dividend payment date.
Notices
Notices and other communications provided to participants
in the DRP will be mailed to you at your address as shown in the records of CIBC
Mellon.
Administration and costs
CIBC Mellon will administer the DRP.  We will pay all
administrative costs related to the DRP.
Our responsibility with respect to the DRP
We are not liable under the DRP for any good faith act or
omission, including, without limitation, any claim of liability with respect to
any form, notice or other writing sent to CIBC Mellon, or with respect to the
calculation of the market value of Common Shares on the dividend payment date
and the number of new Common Shares issued under the DRP.
Amendment, suspension or termination of the DRP
We have the right to amend, suspend or terminate the DRP
at any time. However, any such action will not have retroactive effect with
respect to cash dividends reinvested prior to the date of amendment, suspension
or termination. Written notice of any amendment, suspension or termination
affecting the DRP will be sent to each participant in the DRP. If the DRP is
terminated by us, a certificate for the appropriate number of whole Common
Shares will be issued and mailed to you together with a cheque for the proceeds
of sale of any fraction of a Common Share.
No right to receive dividends 
Our Board of Directors may declare dividends on Common
Shares entirely at its discretion and in accordance with applicable law.  Your
participation in the DRP does not entitle you to any dividend payment except to
the extent a dividend is declared by the Board of Directors.

 

HOW CAN I PARTICIPATE? 
You may participate in the DRP if you own one or more of
our Common Shares.
How can I participate if my Common Shares are recorded
in my own name in Alcan's records? 
If your Common Shares are recorded in your own name, to
participate in the DRP you must complete the form accompanying this prospectus
as described below.  A pre-addressed envelope for returning completed forms is
enclosed.
To participate in the DRP, please return the form to CIBC
Mellon Trust Company, our registrar and transfer agent, which we refer to as
CIBC Mellon.
 
5
 

The completed form should be
addressed as follows:

	
		
		
If delivered by hand or courier, to:
		
		
CIBC Mellon Trust Company
	
	
		
		
 
		
		
320 Bay Street
	
	
		
		
 
		
		
3rd Floor
	
	
		
		
 
		
		
Toronto, Ontario, Canada
	
	
		
		
 
		
		
M5H 4A6
	
	
		
		
    
		
		
    
	
	
		
		
If mailed, to:
		
		
CIBC Mellon Trust
		Company
	
	
		
		
 
		
		
P.O. Box 7010
	
	
		
		
 
		
		
Adelaide Street
		Postal Station
	
	
		
		
 
		
		
Toronto, Ontario,
		Canada
	
	
		
		
 
		
		
M5C 2W9
	

 
How can I participate if my Common Shares are held
through an account with an investment dealer? 
If your Common Shares are owned through an account with
an investment dealer, to participate in the DRP you must contact your investment
dealer and require the investment dealer to transfer one or more Common Shares
into your name.
If you hold your Common Shares in a segregated registered
account with an investment dealer, such as a Registered Retirement Savings Plan
in Canada or a 401(k) investment plan in the United States, to participate in
the DRP you must contact your investment dealer and request that some or all of
your Common Shares be enrolled in the DRP.
Where can I obtain additional forms or more information?
Additional forms and other information about the plan may
be obtained from CIBC Mellon at the above addresses or by telephoning (416)
643-5500 or toll free throughout North America 1-800-387-0825 or on our website
at www.alcan.com.




   
TAX CONSEQUENCES
The following summary of the material Canadian and
United States Federal income and estate tax consequences to participants in the
DRP is intended for general information only, and is not tax advice.  You are
urged to consult with a tax advisor regarding the tax consequences to you of
participation in the DRP, including the Canadian and United States federal,
state and local tax consequences of participation, as well as the tax
consequences of subsequent disposition of Common Shares acquired pursuant to the
DRP. In some countries, certain transactions may require foreign exchange
approval.
CANADA
Shareholders resident in Canada will be treated as having
received a cash dividend equal to the amount applied to purchase newly-issued
Common Shares under the DRP. Individual shareholders and trusts taxable as
individuals will include in income such dividends grossed up for the purpose of
income calculation and will be entitled to a tax credit. Public corporations
will not be subject to tax in respect of such dividend. Special rules apply to
other types of corporations.
For purposes of calculating a capital gain or loss, the
adjusted cost base of the Common Shares purchased under the DRP will equal the
amount paid therefor. The cost of these Common Shares will be averaged with the
adjusted cost base of all other Common Shares acquired by the shareholder after
1971. If the shareholder holds Common Shares considered for tax purposes to have
been acquired prior to 1972 and Common Shares acquired since 1971, the
shareholder is deemed to have first disposed of the Common Shares acquired prior
to 1972. Upon disposition of any Common Shares, including fractions, the
shareholder will include in income one-half of the excess of the proceeds of
disposition over the adjusted cost base thereof.
For minimum tax purposes, the four fifths of net capital
gains are to be included in computing adjusted taxable income.
 
6
 

UNITED STATES
General
The following discussion summarizes both the material
United States federal income tax consequences and the Canadian withholding tax
consequences to you as a participant in the DRP if you are a beneficial owner of
Common Shares that is:

	
a citizen or resident of
	the United States,
	
a domestic corporation,
	
an estate the income of
	which is subject to United States federal income tax, regardless of its
	source, or
	

	a
	trust if a United States court is able to exercise primary supervision over
	administration of the trust and one or more United States persons have
	authority to control all substantial decisions of the trust.

This summary applies to you only if you hold your Common
Shares as capital assets. This summary does not deal with the tax consequences
applicable to all categories of investors, some of which (such as
broker-dealers, traders in securities that elect to mark to market, banks,
regulated investment companies, tax-exempt organizations, certain insurance
companies, persons liable for the alternative minimum tax, persons that hold
securities that are a hedge or that are hedged against currency risks or that
are part of a straddle or conversion transaction, or persons whose functional
currency is not the United States dollar) may be subject to special treatment
under the federal income tax laws. This summary is based on the Internal Revenue
Code of 1986, as amended, its legislative history, existing and proposed
regulations thereunder, published rulings and court decisions, all as currently
in effect and all subject to change at any time, perhaps with retroactive
effect. You are advised to consult your own tax advisor with respect to your
particular circumstances and with respect to the effects of United States
federal, state, local or other laws to which you may be subject.
Dividend Reinvestment
Plan
A
dividend received by you will be subject to United States federal income tax and
may also be subject to state and local taxation.  In addition, a dividend
received pursuant to the DRP by a Shareholder residing in the United States will
generally be subject to a 15% Canadian withholding tax.  Subject to certain
limitations, you may credit the Canadian withholding tax against your United
States federal income tax liability or, if you elect not to credit any foreign
taxes in the taxable year that that withholding tax is paid, you may deduct that
tax from your United States federal gross income.  
For United States federal income tax purposes, you must
include in gross income a distribution equal to the fair market value on that
date of the shares credited to your account plus the amount of the Canadian
withholding tax.  The market value of a share on any day will be the average of
the closing sale prices for board lots of the Common Shares on the Toronto Stock
Exchange and for round lots of the Common Shares as reported on the New York
Stock Exchange - Consolidated Trading during the last five trading days prior to
the relevant dividend payment date.  As described in "Dividend Reinvestment Plan
- Determination of market value and the number of Common Shares you will
receive", beginning on page 4 the number of Common Shares to be credited may be
based on a value different from the market value of a Common Share on the
dividend payment date.  The United States dollar value of the Canadian
withholding tax of 15% of the cash dividend that you would have received in the
absence of an election to reinvest in newly-issued Common Shares will be
determined by using the currency exchange rate on the dividend payment date.
Distributions with respect to your Common Shares will be
treated as ordinary dividend income to the extent of your share of current or
accumulated earnings and profits as determined for United States federal income
tax purposes.  Such dividends will not be eligible for the dividends-received
deduction allowed to United States corporations under the Internal Revenue Code.
The amount of any distribution in excess of your share of current and
accumulated earnings and profits will first be applied to reduce your tax basis
in the Common Shares, and any amount in excess of tax basis will be treated as
gain from the sale or exchange of your Common Shares.
You will recognize gain or loss upon sale or exchange of
a share received pursuant to the DRP, including the sale of any fractional
Common Share upon termination of participation in the DRP.  The amount of gain
or loss will be the difference between the amount received for the Common Share
and its tax basis.  The tax basis of the Common Share will be its market value
on the dividend payment date.  Any gain or loss will be capital gain or loss,
and will be long-term capital gain or loss if the Common Share was held for more
than one year.  The holding period for a Common Share acquired pursuant to the
DRP will begin on the day following the dividend payment date.
 
7
 

You will not realize any taxable income upon receipt of
certificates for whole shares credited to your account, either upon your request
for one or more certificates for certain of those Common Shares or upon
termination of your participation in the plan.
Withholding
Information reporting to the IRS by us or paying agents
and custodians located in the United States will be required with respect to
payments of dividends on the Common Shares to United States persons. In
addition, under the backup withholding rules, you may be subject to backup
withholding with respect to dividends paid unless you (a) are a corporation or
come within certain other exempt categories and, when required, demonstrate this
fact, or (b) provide a taxpayer identification number, certify as to no loss of
exemption from backup withholding, and otherwise comply with applicable
requirements of the backup withholding rules. A United States shareholder that
does not provide us with his or her correct taxpayer identification number may
also be subject to penalties imposed by the IRS. Backup withholding is not an
additional tax and may be credited against your regular federal income tax
liability.
OTHER COUNTRIES
Dividends applied under the DRP to the purchase of
newly-issued Common Shares for shareholders residing in countries having tax
treaties with Canada are, generally speaking, subject to a 15% Canadian
withholding tax. Dividends so applied for shareholders resident in other
countries are subject to a 25% Canadian withholding tax.
 

DESCRIPTION OF SHARE
CAPITAL
Securities presently issued by us

	
		
		
 
		
		
Authorized
		
		
Outstanding*
	
	
		
		
 
		
		
 
		
		
 
	
	
		
		
Common Shares
		
		
unlimited
		
		
366,686,115
	
	
		
		
 
		
		
 
		
		
 
	
	
		
		
Preference Shares,
		issuable in series, of which the following series are outstanding:
		
		
unlimited
		
		
 
	
	
		
		

		Floating Rate Cumulative Redeemable Preference Shares, Series C, 1984
		
		
4,199,900
		
		
4,199,900
	
	
		
		

		Floating Rate Cumulative Redeemable Preference Shares, Series C, 1985
		
		
1,500,000
		
		
1,500,000
	
	
		
		

		Cumulative Redeemable Preference Shares, Series E
		
		
2,999,000
		
		
2,999,000
	

* As at November 30, 2006.
Authorised capital
We may issue an unlimited number of additional Common
Shares and preference shares from time to time upon approval by our Board of
Directors for such consideration as the Board of Directors deems appropriate,
without the need of further shareholder authorisation.  However, the Board of
Directors is not allowed to create or issue any series of preference shares with
voting rights, other than voting rights arising only in the event of non-payment
of dividends, without the consent of our shareholders, given by way of special
resolution.  The terms of any preference shares, including dividend rates,
conversion and voting rights, if any, redemption prices and similar matters will
be determined by the Board of Directors prior to issuance.
Summary of certain provisions of the preference shares
We currently have the following preference shares
outstanding: Floating Rate Cumulative Redeemable Preference Shares Series C,
1984 and 1985 and Cumulative Redeemable Preference Shares Series E.  The holders
of each class of preference share will be entitled to receive cumulative cash
dividends at the following rates:
 
8
 

Series C, 1984 and 1985: 
quarterly dividends in an amount determined by applying to C$ 25 per share 25%
of the greater of (1) 72% of the average of the Canadian prime interest rates
quoted by two major Canadian banks for stated periods, and (2) the lesser of
7.5% and the average of the Canadian prime interest rates quoted by two major
Canadian banks for stated periods.
Series E:  quarterly
dividends in an amount determined by applying to C$ 25 per share 25% of 75% of
the average of the Canadian prime interest rates quoted by two major Canadian
banks for stated periods.
The holders of preference shares are not entitled to vote
at meetings of shareholders unless we fail to pay six quarterly dividends on
such preference shares.  Thereafter, so long as such dividends remain in
arrears, the holders will be entitled, voting separately as a class, to elect
two members of the Board of Directors.
In the event that we liquidate, dissolve or wind up or
distribute our assets among shareholders for the purpose of winding up our
affairs, the holders of the preference shares will be entitled to receive, in
preference to holders of the Common Shares, the sum of C$ 25 per preference
share for Series C and E plus all accrued and unpaid dividends.  Additionally,
if such distribution is voluntary, an additional amount equal to the premium, if
any, will be payable on redemption.
The preference shares are redeemable at our option at
C$ 25 per preference share plus all accrued and unpaid dividends.
Unless all dividends then payable on the preference
shares have been declared and paid or set apart for payment, we will not (1) pay
any dividends, other than stock dividends, or make any distributions on any
shares ranking junior to the preference shares with respect to the payment of
dividends or return of capital, (2) retire for value any shares ranking junior
to the preference shares with respect to payment of dividends or return of
capital, or (3) except in connection with the exercise of a retraction
privilege, retire less than all of a series of preference shares.
Summary of certain provisions of the Common Shares
Attributes 
The Common Shares are subject to the rights of the
holders of the preference shares, as described above, and of any other preferred
securities issued in the future.
The holders of Common Shares are entitled to one vote per
Common Share at all meetings of Shareholders, to participate rateably in any
dividends which may be declared on Common Shares by our Board of Directors and,
in the event of our liquidation, dissolution or winding-up or other distribution
of our assets or property, to a pro rata share of our assets after payment of
all liabilities and obligations.  The Common Shares have no pre-emptive,
redemption or conversion rights.
The provisions of the Canada Business Corporation Act ("CBCA")
require that the amendment of certain rights of holders of any class of shares,
including the Common Shares, must be approved by not less than two-thirds of the
votes cast by the holders of such shares. A quorum for any meeting of the
holders of Common Shares is 40% of the Common Shares then outstanding.
Therefore, it is possible for the rights of the holders of Common Shares to be
changed other than by the affirmative vote of the holders of the majority of the
outstanding Common Shares. In circumstances where certain rights of holders of
Common Shares may be amended, however, holders of Common Shares will have the
right, under the Canada Business Corporation Act, to dissent from such amendment
and require us to pay them the then fair value of their Common Shares.
Shareholders are also entitled to rights and privileges
under the shareholder rights plan summarized below.

Shareholder Rights Plan 
In 1990, Shareholders approved a plan whereby each Common
Share of Alcan carries one right to purchase additional Common Shares. The plan,
with certain amendments, was reconfirmed at the 1995 Annual Meeting and further
amendments were approved at the 1999 Annual Meeting. The plan was reconfirmed
with no amendments at the 2002 Annual Meeting. The plan was again reconfirmed
for a three-year period with further amendments at the 2005 Annual Meeting. The
terms of the plan are contained in the Shareholder Rights Agreement made as of
December 14, 1989 between us and CIBC Mellon, as amended. A copy of the plan was
filed as Exhibit 99 to Form 8‑K dated April 29, 2005. The rights under the plan
are not currently exercisable but may become so upon the acquisition by a person
or group of affiliated or associated persons ("Acquiring Person") of beneficial
ownership of 20% or more of Alcan's outstanding voting shares or upon the
commencement of a take-over bid. Holders of rights, with the exception of an
Acquiring Person, in such circumstances will be entitled to purchase from us,
upon payment of the exercise price (currently U.S.$100.00), such number of
additional Common Shares as can be purchased for twice the exercise price based
on the market value of Alcan's Common Shares at the time the rights become
exercisable.
 
9
 

The plan has a permitted bid
feature which allows a take-over bid to proceed without the rights under the
plan becoming exercisable, provided that it meets certain minimum specified
standards of fairness and disclosure, even if the Board does not support the
bid.
The plan expires in 2008, but
may be redeemed earlier by the Board, with the prior consent of the holders of
rights or Common Shares, for U.S.$0.01 per right. In addition, should a person
or group of persons acquire outstanding voting shares pursuant to a permitted
bid or a share acquisition in respect of which the Board has waived the
application of the plan, the Board shall be deemed to have elected to redeem the
rights at U.S.$0.01 per right.
USE OF PROCEEDS
The net proceeds we receive from the issuance of Common
Shares under the plan will be added to our general funds and made available for
general corporate purposes, including capital expenditures and working capital
requirements.
LEGAL MATTERS
The validity of the Common Shares offered through this
prospectus and the Plan herein described has been passed upon by Roy Millington,
Alcan lawyer.
EXPERTS
The financial statements and management's report on the
effectiveness of internal control of financial reporting, incorporated by
reference in this prospectus to our Annual Report on Form 10‑K for the year
ended December 31, 2005, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, Montreal, Quebec, Canada, chartered accountants,
given on the authority of the said firm as experts in auditing and accounting.
INDEMNIFICATION
As a corporation incorporated under the CBCA, we may
indemnify our directors and officers. In general, the CBCA provides that one of
our directors or officers may be indemnified by us against all costs, charges
and expenses, including an amount paid to settle an action or satisfy a judgment
if (i) he or she acted honestly and in good faith with a view to our best
interests and (ii) in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty, he or she had reasonable
grounds for believing that his or her conduct was lawful. The directors have
entered into agreements with us providing for indemnification as permitted by
the CBCA.
The right to indemnification is more limited, however,
where directors and officers are sued by us or on our behalf by a shareholder.
In those cases, we may, with the approval of a court, indemnify a director or
officer against all costs, charges and expenses reasonably incurred by him or
her but not the amount of the judgment or settlement of an action, provided he
or she fulfills the conditions of (i) and (ii) above. A director or officer must
be indemnified for costs, charges and expenses reasonably incurred by him or her
if he or she was not judged by the court or other competent authority to have
committed any fault or omitted to do anything that the individual ought to have
done and fulfills the conditions of (i) and (ii) above.
Insofar as indemnification for liabilities arising under
the Securities Act of 1933 of the United States of America may be permitted to
directors, officers or persons controlling us pursuant to the foregoing
provisions, we have been informed that, in the opinion of the Securities and
Exchange Commission, such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable.
 
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We carry insurance covering liability, including defense
costs, of our directors and officers and all subsidiaries incurred as a result
of acting as such directors and officers, provided he or she acted honestly and
in good faith with a view to our best interests or those of the relevant
subsidiary.
In respect of indemnity payments made by us to a director
or officer for a claim covered by the liability insurance, we will be reimbursed
for such payments (subject to the deductible and policy limit) by our insurers.
WHERE YOU CAN FIND MORE INFORMATION
We have filed this prospectus with the Securities and
Exchange Commission, under the Securities Act of 1933, as amended, that
registers the Common Shares to be issued under the DRP.  The registration
statement, including the attached exhibits and schedules, contains additional
relevant information about us and our Common Shares.  The rules and regulations
of the SEC allow us to omit some information included in the registration
statement from this document.
We file annual, quarterly and special reports and other
information with the SEC. Any document so filed can be viewed at the SEC's
public reference room at 100 F Street, N. E., Washington, D. C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the operation of the
SEC's website at www.sec.gov. Such documents, and amendments thereto, filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are
also available, as soon as reasonably practicable, after Alcan has
electronically filed such materials, through its website at www.alcan.com.
The SEC also maintains Internet website that contains
reports, proxy statements and other information about issuers like us who file
electronically with the SEC. The URL of that website is www.sec.gov.
The SEC allows us to "incorporate by reference"
information into this document.  This means that we can disclose important
information to you by referring you to another document filed separately with
the SEC.  The information incorporated by reference is considered to be a part
of this document, except for any information that is superseded by information
that is included directly in this document.
This document incorporates by reference the documents
listed below that we previously filed with the SEC.  They contain important
information about us and our financial condition.

	

	

	Our Annual Report on Form 10-K for the year ended December 31, 2005;
	
	

	

	Our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006,
June 30, 2006 and September 30, 2006; and
	

	

	Our Current Reports on Form 8-K dated October 24, 2006, October 31, 2006,
November 8, 2006, December 12, 2006 and December 22, 2006.

All documents subsequently filed by us pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of
a post-effective amendment which indicates that all securities offered have been
sold or which deregisters all such securities then remaining unsold, shall be
deemed to be incorporated by reference in this prospectus and to be a part of
this prospectus from the date of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for the purposes of this
prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus.
 
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You may obtain, without
charge, a copy of any of the documents incorporated by reference in this
prospectus, excluding any exhibits to those documents unless the exhibit is
specifically incorporated by reference as an exhibit in that document.  You can
obtain these documents by requesting them by telephone from CIBC Mellon at
(416) 643-5500 or toll free throughout North America 1-800-387-0825 or in
writing at the following address:

P.O.
Box 7010

Adelaide Street Postal Station

Toronto, Ontario, Canada

M5C 2W9

inquiries@cibcmellon.com
Proxy circulars, annual reports and other information
concerning us can also be inspected on Alcan's Internet website at www.alcan.com and on SEDAR (website of the Canadian Securities
Administrators) at www.sedar.com.
We have not authorized anyone to give any information or
make any representation about the DRP or us that is different from, or in
addition to, that contained in this document or in any of the materials
incorporated into this document.  Therefore, if anyone does give you information
of this sort, you should not rely on it.  If you are in a jurisdiction where
offers to exchange or sell, or solicitations of offers to exchange or purchase,
the securities offered by this document or the solicitation of proxies is
unlawful, or if you are a person to whom it is unlawful to direct these types of
activities, then the offer presented in this document does not extend to you. 
The information contained in this document speaks only as of the date of this
document unless the information specifically indicates that another date
applies.

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