Hindalco Industries completes acquisition of Novelis Inc.

Hindalco Industries Ltd has announced that Novelis Inc. on May 15, 2007 has announced the completion of its acquisition by the Company. The transaction makes the Company, with Novelis, the world’s largest aluminum rolled products Company and one of the largest producers of primary aluminum in Asia, as well as being India's leading copper producer. Novelis will operate as a subsidiary of the Company.

The Company entered into an agreement with Novelis, dated February 10, 2007, to acquire the company in an all-cash transaction which values Novelis at approximately US $ 6.0 billion, including debt. Under the terms of the agreement, Novelis shareholders will receive US $ 44.93 in cash for each outstanding common share. Novelis shareholders approved the transaction at a special meeting on May 10.

Based in Mumbai, India, the Company is the flagship Company of the Aditya Birla Group, a multinational conglomerate with annual revenue of US $ 14 billion and a market capitalization in excess of US $ 23 billion.

Kumar Mangalam Birla, Chairman of the Company said, "We look upon the aluminum business as a core business that has enormous growth potential in revenues and earnings. Our vision is to be a premium metals major, global in size and reach with a passion for excellence. The acquisition of Novelis is a step in this direction."

"The combination of Hindalco and Novelis establishes an integrated producer with low-cost alumina and aluminum facilities combined with high-end rolling capabilities and a global footprint," added Mr. Birla. "The complementary assets and expertise of the team provides a strong platform for growth and success."

The transaction was accomplished by way of a statutory plan of arrangement under Canadian law. The Company through its wholly-owned subsidiary AV Metals Inc., acquired 75,415,536 common shares of Novelis, representing 100 percent of the issued and outstanding common shares. Immediately after closing, AV Metals Inc. transferred the common shares of Novelis to its wholly-owned subsidiary AV Aluminum Inc.

Novelis’ stock has ceased trading on the New York Stock Exchange. De-listing on the New York Stock Exchange and the Toronto Stock Exchange is expected to occur shortly.

Source : Equity Bulls

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