Hindalco Industries Chairman Kumar Mangalam Birla on Friday said there had been no official intimation from the European Union (EU) on the Novelis-Aleris deal. His statement came amid reports that the EU was set to approve Hindalco-owned Novelis’ $2.6-billion bid for Aleris.
He was speaking to Hindalco’s shareholders at the 60th annual general meeting (AGM).
Novelis, a US-based subsidiary of Hindalco Industries, has agreed to sell Aleris’ Belgian plant to address European Commission worries that the deal might reduce competition and lead to higher prices, hitting carmakers in particular, said reports.
“We have submitted remedial measures to the EU and an outcome is likely in the near term,” Managing Director Satish Pai told reporters on the sidelines of the AGM, without divulging details of the remedial measures.
Though the commission is scheduled to decide on the case by October 7, Pai said the outcome was likely before the set date.
In July 2018, Novelis announced signing of a definitive agreement to acquire Aleris Corporation, a global supplier of rolled aluminium products, for approximately $2.6 billion, including the assumption of debt.
Alongside, noting the drop in LME prices of aluminium and the overall economic outlook, Hindalco Industries has cut its India market capex of ~2,600 crore for 2019-20 to ~2,000 crore.
However, on the downstream value-added products side, Birla said the company aimed at doubling the share of value-added products in the domestic aluminium business over the next 5-6 years and invest around $1.0 - $1.2 billion. It will also expand its alumina capacities with an expansion at Utkal Alumina refinery by 500,000 tonnes to be commissioned by FY21.
In the copper business, Birla said the share of copper cast rods to total cathodes rose to nearly 79 per cent in 2018-19, from the earlier 41 per cent. However, imports of aluminium and copper continue to hurt the domestic industry, said Birla.