The approval is subject to the sale of Aleris’ plant in Duffel at Belgium, which produces aluminum for the automotive and specialties markets, said the company in a statement.
Hindalco Industries’ US-based subsidiary Novelis is at present working to sell the plant to potential buyers and sign a definitive agreement, subject to European Commission approval, it said.
“Today’s announcement is another step forward in bringing Novelis and Aleris together, which will benefit our customers, employees and the aluminum industry as a whole,” the statement quoted Steve Fisher, president and CEO at Novelis Inc, as saying.
With this conditional approval in the European Union, as well as a clear path forward for approval in the US, Novelis continues to work closely with the Chinese State Administration for Market Regulation (SAMR) to receive its approval.
“Overall, this transaction (deal with Aleris) will strengthen our ability to compete against steel in the automotive market, meet growing customer demand for aluminum, achieve our recycling goals, and bolster our sustainability platform worldwide. In addition, it will further enhance our strategic position in Asia and diversify our overall product portfolio,” Fisher said.
The company expects to close the transaction by January 21, 2020, the outside date under the merger agreement.
Aleris operates 14 production facilities in North America, Europe and Asia.
Duffel is one of the largest rolling mills in Europe, producing rolled products from aluminum and special alloys. It has a CALP (Continuous Annealing Line with Pre-Treatment) 140-inch (3.556 m) hot rolling mill.
Early last month, Aditya Birla Group company Hindalco Industries faced a regulatory hurdle from the US Department of Justice (DOJ).
The Justice Department filed a civil antitrust lawsuit seeking to block the purchase by Hindalco’s US subsidiary Novelis, as the case cited the need to preserve competition in the North American market for rolled aluminum sheet for automotive applications.
Novelis had announced signing of a definitive agreement to acquire Aleris Corporation in Jul 2018 for approximately $2.6 billion, including the assumption of debt.