Hindalco to pay $6 bn in cash for Novelis
Announcing the deal, Birla group chairman Kumar Mangalam Birla said it would include $2.4 bn in debt.
By PTI |
MUMBAI: Aditya Birla Group company Hindalco on Sunday announced the acquisition of US-based aluminium firm Novelis for six billion dollars in an all-cash deal.
Announcing the acquisition, Birla group chairman Kumar Mangalam Birla on Sunday said the deal would include $2.4 billion in debt.
The shareholders of Atlanta-based Novelis, a demerged entity of Canadian aluminium giant Alcan, would meet after the court's approval, Birla said.
Novelis shareholders would recieve $44.93 per share as part of the deal, which is 16.5 per cent over Saturday's closing price. The deal requires approval from shareholders of two-third of the company's total equity capital.
Following the acquisition of Novelis, Hindalco world's largest aluminium rolling company, one of the biggest producer of primary aluminium in Asia and India's leading copper producer.
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The transaction is expected to be completed in the second quarter of 2007, the two companies said in a joint statement.Birla said, "The acquisition of Novelis is a landmark transaction for Hindalco and our group. It is in line with our long-term strategies of expanding our global presence across our various businesses and is consistent with our vision of taking India to the world."
The combination would establish a global integrated aluminium producer with low-cost alumina and aluminium production facilities combined with high-end aluminium rolled product capabilities, Birla added.
Novelis' acting CEO Ed Blechshmidt said in a statement that the board unanimously agreed that the deal delivers outstanding value to the company's shareholders.
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Hindalco's Managing Director Debu Bhattacharya said that there are significant geographical market and product synergies and the acquisition would give the company immediate scale and a global footprint.The two companies said in a joint statement that the deal was unanimously approved by their respective boards and the closing of the transaction was not conditional on Hindalco obtaining financing.
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