MUMBAI: Shares of Hindalco Industries rose 2.7% after the company’s subsidiary, Novelis Inc, announced the closure of sale of former Aleris plant in Duffel, Belgium, to ALVANCE, the international aluminium business of the GFG Alliance.
At 0251 pm, Hindalco shares traded at ?178.45, up 2.5% from its previous close, while the benchmark Sensex was up 0.9% to 39,047.06.
Earlier, the European Commission and Chinese State Administration for Market Regulation had determined that Novelis’s acquisition of Aleris, which closed earlier this year, could proceed on the condition that Novelis divest the Duffel plant to a third party that met certain buyer suitability requirements.
“Both regulators have now approved ALVANCE as a suitable buyer and have permitted the sale to be completed,” the company said in a BSE filing made on Friday.
In November last year, ALVANCE had agreed to acquire the Duffel facility for 310 million euros. At closing on 30 September, Novelis received 210 million euros in cash. The parties have agreed to a post-closing arbitration process regarding the payment of the remaining 100 million euros.
The Aleris acquisition provides a strong pro-forma financial profile for Novelis with many strategic benefits and continues to be value accretive, with the long-term outlook in line with the original acquisition case.
Novelis, the world’s largest recycler of aluminium, serves customers in the aerospace, automotive, beverage can and specialties industries throughout North America, Europe, Asia, and South America.
The company reported a standalone net loss of ?40 crore for the June quarter compared to a net profit of ?23 crore in the year-ago period. Revenue from operations stood at ?7,420 crore in the last quarter, down 26% on year.
Hindalco Industries, among the flagship company of the Aditya Birla Group, is the world’s largest aluminium rolling and recycling company, and a major copper player. It is also one of Asia’s largest producers of primary aluminium.
News Source:- Livemint