SYDNEY – Aluminum producer Alcoa has agreed to an all-stock deal to acquire Australian Alumina Company, valued at approximately A$3.35 billion (US$2.20 billion).
Alcoa AA, based in Pittsburgh,
Offers 0.02854 of its own stock for each Alumina AWC,
stock, representing a 13% premium to Alumina's closing stock price on Friday. Alumina said it recommends that shareholders vote in favor of the offer, which comes after the rejection of a number of previous offers submitted by Alcoa.
Alcoa said it had reached an agreement with fund manager Allan Gray Australia that would give it the right to buy up to 19.9% of Alumina.
Alumina owns a 40% stake in Alcoa World Alumina & Chemicals, or AWAC, a joint venture with Alcoa that operates bauxite mining, alumina refining and aluminum smelting operations.
“Alcoa has proven its effectiveness in operating AWAC, and we recognize the value creation opportunities possible under a streamlined ownership structure,” said William F. Oblinger, Alcoa's president and CEO.
