Alcoa emerges top aluminum producer after Swedish stake-swap

23 December 2008

Alcoa, the world's third largest producer of aluminum, behind Rio Tinto Alcan and Rusal said yesterday that it had emerged as the world's largest primary aluminum producer after its stake swap deal with Norweigan Orkla ASA in SAPA extrusion profiles and Sweden's Elkem Aluminum.

Pittsburgh, Pennsylvania-based, Alcoa and Orkla ASA (Orkla) have agreed to exchange their stakes in a Norwegian smelting partnership and a Swedish extrusion joint venture.

The SAPA joint venture was created in July 2007 when Alcoa combined its soft alloy business with Orkla's SAPA unit. Aluminum extrusions are used for design solutions in virtually all sectors.

Under the agreement, Alcoa will receive Orkla's 50-per cent stake in Elkem Aluminum ANS while Orkla will receive Alcoa's 45-per cent stake in the $3.7-billion SAPA extrusion profiles business. The transaction is expected to be completed in the first quarter of 2009.

Elkem Aluminum, which will be 100-per cent owned by Alcoa following the transaction, includes aluminum smelters in Lista and Mosjoen, Norway with a combined output of 282,000 metric tons per year (mtpy). Included in the transaction is Elkem's stake in a newly opened anode plant in Mosjoen in which Alcoa already holds an approximately 82 per cent stake.

The addition of these assets increases Alcoa's global smelting capacity to more than 4.7 million metric tons, making Alcoa the world's largest primary aluminum producer.