Deal includes $4.1B in cash and stock plus a $750M contingent payment tied to alumina prices.
Alcoa will purchase South32’s bauxite mine, alumina refinery, and aluminum smelter operations in a transaction valued at up to $5.6B. The agreement consists of $4.1B in cash and stock, with an additional $750M contingent on alumina price performance.
Shares of Alcoa (AA) fell 1.7% in post-market trading following the announcement. The deal expands Alcoa’s production capacity but adds significant leverage to its balance sheet amid volatile aluminum markets.
No immediate market reaction was reported for South32 (SOUHY), though the sale aligns with its strategy to streamline operations.