Aditya Birla Group flagship Hindalco Industries on Wednesday completed its bid to own Utkal Alumina, a joint venture it had with Alcan, when it agreed to buy out the Canadian company’s 45% equity stake in the venture for an undisclosed amount. The acquisition of Utkal Alumina would give Hindalco ownership of 195 million tonnes of high grade bauxite, that is a key raw material for making aluminium metal.
Although Hindalco officials declined to specify the amount they will spend to buy out Alcan’s stake, it has been learnt that an alumina plant of 1.5 million tonnes capacity will cost Rs 5,000 crore to build. The acquisition of Utkal Alumina also gives the Birlas complete ownership of high grade alumina which could be used to feed the group’s forthcoming aluminium projects. Once all projects are completed, the group will have ownership of about 5.2 million tonnes of alumina.
Alcan, which is at present the target of a friendly $38-billion takeover offer from British mining major Rio Tinto, had in April announced its plan to exit the joint venture. Hindalco held the remaining 55% stake and the first right of refusal for its partner’s stake.
Read more in The Economic Times article.
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