Kaiser Aluminium completes acquisition of Alcoa rolling mill business
Kaiser Aluminum Corporation has announced that it has completed its acquisition of Alcoa Warrick LLC, containing all the assets of the Warrick Rolling Mill (“Warrick”), from Alcoa Corporation (“Alcoa”) for a purchase price of $670 million.
Alcoa retains ownership of the related smelting assets, power plant, and land. In conjunction with the acquisition, Kaiser Aluminum has entered into a long-term ground lease that includes provisions for utility services, and other agreements that include a transition services agreement and a market based molten aluminium supply agreement.
“Today we begin a new chapter in our history as we welcome 1,200 Warrick employees to the Kaiser Aluminum family,” said Keith A. Harvey, President and Chief Executive Officer. “The acquisition provides us with a strategic re-entry into the attractive aluminum packaging industry with excellent opportunities for further growth and significantly enhances, diversifies and reduces the cyclicality of our portfolio.
“The outlook for the beverage and food packaging markets is strong with favorable demand and industry dynamics driving growth. The Warrick rolling mill is one of only four dedicated can sheet mills in North America and we expect to become a significant participant in the supply chain solution in meeting the growing North American demand,” stated Mr. Harvey.
The acquisition closed on 31 March 2021 and the total purchase price was funded with a combination of existing cash on hand, and the assumption of other post-employment benefits (OPEB) liabilities, subject to other customary post-closing adjustments. The company will provide additional information and an updated outlook for 2021, reflecting the addition of Warrick, during its first quarter earnings call in April 2021.