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.
Showing posts with label Hindalco. Show all posts
Showing posts with label Hindalco. Show all posts
Thursday, July 19, 2007
Tuesday, June 19, 2007
Ruias to raise $900 m to fund Algoma buy
Essar Global, the international holding company for the Ruias, will raise $900 million through a combination of senior notes and loans to fund its acquisition of Canada’s Algoma Steel, sources said.
The non-recourse fund raising exercise by Essar Global is the second-largest such transaction by an Indian steel company, after Tata Steel’s almost $7 billion loan to finance its acquisition of Anglo-Dutch steelmaker Corus.
The Ruias’ international holding company had acquired Algoma in April for $1.58 billion in an all-cash leveraged buyout that is likely to pitchfork the Essar group with the Tatas in North America. Essar Global’s acquisition is considered the second biggest by an Indian company in North America, after Hindalco paid $6 billion to buy Atlanta-based Novelis in February. To finance its Algoma acquisition, Essar Global will sell $450 million of senior notes, recoursed to the Canadian company’s balance sheet, according to sources. The eight-year notes, denominated in dollars, may yield 9.75% to 10%. UBS is the financial advisor to the offer.
Essar Global also plans to issue $450 million in loans, based on Algoma’s earnings. The group’s own contribution will be about $500 million. It could not be ascertained how the rest of the acquisition amount — about $100 million — will be raised.
Read more in The Economic Times article.
The non-recourse fund raising exercise by Essar Global is the second-largest such transaction by an Indian steel company, after Tata Steel’s almost $7 billion loan to finance its acquisition of Anglo-Dutch steelmaker Corus.
The Ruias’ international holding company had acquired Algoma in April for $1.58 billion in an all-cash leveraged buyout that is likely to pitchfork the Essar group with the Tatas in North America. Essar Global’s acquisition is considered the second biggest by an Indian company in North America, after Hindalco paid $6 billion to buy Atlanta-based Novelis in February. To finance its Algoma acquisition, Essar Global will sell $450 million of senior notes, recoursed to the Canadian company’s balance sheet, according to sources. The eight-year notes, denominated in dollars, may yield 9.75% to 10%. UBS is the financial advisor to the offer.
Essar Global also plans to issue $450 million in loans, based on Algoma’s earnings. The group’s own contribution will be about $500 million. It could not be ascertained how the rest of the acquisition amount — about $100 million — will be raised.
Read more in The Economic Times article.
Tuesday, June 5, 2007
Hindalco shares rise 4% on takeover buzz
The Aditya Birla group-promoted Hindalco industries, the country’s largest aluminium producer, surged by about 4 per cent on the bourses to Rs 146.60 on market buzz that it could be a takeover target of the Alcan-Sterlite combine.
On a dull trading day, the scrip was the top gainer among the 30 Sensex stocks. It hit a day’s high of Rs 156.25, before profit-booking saw the counter shedding early gains.
The Birla Group holds about 30 per cent stake in Hindalco with foreign institutional investors (FIIs) and institutions holding 20 per cent and 12 per cent, respectively. About 10 per cent is in GDRs, while the remaining is with retail investors.
Sources in the Birla Group said the consolidation in the metal industry was taking place across the world where an identifiable promoter is not present. In Hindalco’s case, there is an identifiable promoter who holds 30 percent stake and would not sell under any circumstances.
Read more in The Business Standard article.
On a dull trading day, the scrip was the top gainer among the 30 Sensex stocks. It hit a day’s high of Rs 156.25, before profit-booking saw the counter shedding early gains.
The Birla Group holds about 30 per cent stake in Hindalco with foreign institutional investors (FIIs) and institutions holding 20 per cent and 12 per cent, respectively. About 10 per cent is in GDRs, while the remaining is with retail investors.
Sources in the Birla Group said the consolidation in the metal industry was taking place across the world where an identifiable promoter is not present. In Hindalco’s case, there is an identifiable promoter who holds 30 percent stake and would not sell under any circumstances.
Read more in The Business Standard article.
Wednesday, May 30, 2007
Hindalco, Sterlite may join Alcan race
India's biggest aluminium maker, Hindalco, and Sterlite Industries, are in talks with global firms to separately bid for Canada's Alcan, said the media report on Wednesday. Citing unnamed sources, the report said Sterlite's parent Vedanta Resources Plc was in advanced talks with global miner Rio Tinto to form a special purpose vehicle to bid for the aluminium major.
London-based Vedanta will likely invest $3-$4 billion and Rio Tinto could put in $10-$12 billion in the joint venture, said the report.
Hindalco Industries Ltd, which earlier this year bought Canadian aluminium firm Novelis for $5.9 billion, was in talks with BHP Billiton for a joint bid but a deal was some distance away.
A Vedanta spokesman declined comment, while a spokeswoman for Hindalco said it was not the company's policy to comment on speculation.
Media reports earlier this week said Norwegian aluminium group Norsk Hydro and Rio Tinto might place separate bids to trump Alcoa's $28.5 billion hostile bid for Alcan, a takeover that would create the world's largest aluminium group.
London-based Vedanta will likely invest $3-$4 billion and Rio Tinto could put in $10-$12 billion in the joint venture, said the report.
Hindalco Industries Ltd, which earlier this year bought Canadian aluminium firm Novelis for $5.9 billion, was in talks with BHP Billiton for a joint bid but a deal was some distance away.
A Vedanta spokesman declined comment, while a spokeswoman for Hindalco said it was not the company's policy to comment on speculation.
Media reports earlier this week said Norwegian aluminium group Norsk Hydro and Rio Tinto might place separate bids to trump Alcoa's $28.5 billion hostile bid for Alcan, a takeover that would create the world's largest aluminium group.
Saturday, May 12, 2007
Novelis nod for Hindalco bid
Hindalco Industries today announced that the shareholders of Novelis approved the former’s proposal to purchase the latter.The shareholders’ approval followed a proposal of Hindalco to acquire the Atlanta-based aluminium downstream leader Novelis for an enterprise value of nearly $ 6 billion three months ago.
Around 99.8 per cent of Novelis shareholders cast votes in favour of the transaction. Under the Canadian laws, the proposed acquisition required support from at least 66. 44 per cent of the shareholders.
The terms of agreement signed between Novelis and Hindalco envisaged that Hindalco will pay $ 44.93 a share, amounting to $3.5 billion (Rs 14,364 crore).Hindalco expects to complete the transaction, which now awaits the court approval, by May 15. The Birla group’s Canada-based special purpose vehicle, AV Metals, will infuse $3.5 billion to finance the deal.
Read more in The Business Standard article.
Around 99.8 per cent of Novelis shareholders cast votes in favour of the transaction. Under the Canadian laws, the proposed acquisition required support from at least 66. 44 per cent of the shareholders.
The terms of agreement signed between Novelis and Hindalco envisaged that Hindalco will pay $ 44.93 a share, amounting to $3.5 billion (Rs 14,364 crore).Hindalco expects to complete the transaction, which now awaits the court approval, by May 15. The Birla group’s Canada-based special purpose vehicle, AV Metals, will infuse $3.5 billion to finance the deal.
Read more in The Business Standard article.
Wednesday, May 9, 2007
LIC hikes Hindalco stake to 9%
Cashing in on the opportunity to consolidate its stake in Hindalco, Life Insurance Corp (LIC) has hiked its stake in the Aditya Birla flagship to over 9% through open market transactions, after its share price plunged on Novelis buyout.
Hindalco, which announced its $6 billion Novelis acquisition on February 11, saw its share price plunging 14% to Rs 149.45 a day later, and has since remained closer to this price.This lured the country's top insurer, which bought more than two crore shares in the company between March 31 and April 28 this year.
Between January 5, 2006 and April 28, 2007, LIC purchased 2.05% or 4.01 crore shares in Hindalco, the company said in a regulatory filing.
However, a closer analysis of the shareholding pattern reveals out of this 4.01 crore shares, LIC acquired 2.13 crore shares for up to Rs 324 crore in just 20 days after March 31.In comparison, it took LIC 15 months to increase its holding to 8.6 crore shares till March 31, from 6.48 crore shares, or 7.01% stake, as on January 5, 2006.
Investors may have dumped the Hindalco stock citing short-term concerns like Tata Steel after acquiring Corus, but LIC took the oppurtunity to grab a position in the company which is slated to be the world's largest aluminium rolling company after the Novelis buy-out.
Hindalco, which announced its $6 billion Novelis acquisition on February 11, saw its share price plunging 14% to Rs 149.45 a day later, and has since remained closer to this price.This lured the country's top insurer, which bought more than two crore shares in the company between March 31 and April 28 this year.
Between January 5, 2006 and April 28, 2007, LIC purchased 2.05% or 4.01 crore shares in Hindalco, the company said in a regulatory filing.
However, a closer analysis of the shareholding pattern reveals out of this 4.01 crore shares, LIC acquired 2.13 crore shares for up to Rs 324 crore in just 20 days after March 31.In comparison, it took LIC 15 months to increase its holding to 8.6 crore shares till March 31, from 6.48 crore shares, or 7.01% stake, as on January 5, 2006.
Investors may have dumped the Hindalco stock citing short-term concerns like Tata Steel after acquiring Corus, but LIC took the oppurtunity to grab a position in the company which is slated to be the world's largest aluminium rolling company after the Novelis buy-out.
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