India’s Hindalco to buy Novelis
The $6b deal is the largest-ever North American acquisition by an Indian company.
Published On 11 Feb 2007
Hindalco is the flagship company of the Indian conglomerate, the Aditya Birla Group with interests in cement, metals, telecommunication and textiles.
No merger
Birla said:”We plan to retain all Novelis employees and see strong synergies across products, with an edge in research. Though Novelis will be a wholly owned subsidiary, we have no plans to merge it into Hindalco.”
He said the transaction was expected to be finalised in the second quarter and included $2.4bn of debt.
The firm is offering $44.93 a share, a premium of almost 17 per cent over Novelis’ stock close of $38.5 on Friday.
Novelis is a leader in aluminium products across Europe and Asia, with a presence across 11 countries, with 36 manufacturing facilities and employing 12,500 people.
Its customers include US auto giant General Motors and soft-drinks mammoth Coca-Cola.
Hindalco’s managing director Debu Bhattacharya said Hindalco would have taken a decade to build the assets that Novelis possessed.
Birla said the group’s sales were expected to nearly double to $20bn from the current $11.8bn.
Post-acquisition, the Birla group will have 50 per cent of its turnover coming from overseas.
Source: News Agencies