JOHANNESBURG (miningweekly.com) - Norwegian aluminium company Norsk Hydro has made a binding offer to acquire diversified miner Rio Tinto's ISAL aluminium plant, in Iceland.
The offer also includes Rio Tinto's 53% share in Dutch anode facility Aluchemie and 50% of its shares in Swedish aluminium fluoride plant Alufluor, for $345-million, subject to post-closing adjustments.
Bringing the ISAL plant into Hydro's fold will increase the Norwegian group's total primary aluminium production to 2.4-million tons in 2018. The renewable energy-based plant produces 210 000 t/y of liquid primary aluminium and 230 000 t/y of extrusion ingot.
"The offer demonstrates our strong belief in aluminium, which is seeing the strongest global demand growth among base metals. Having presence across the value chain is essential to create value from this growth and promote sustainable practices in our global operations," Hydro president and CEO Svein Richard Brandtzæg said in a statement on Monday.
Hydro sees synergies with respect to technology creep, optimisation of anode portfolio and freight and handling.
The Icelandic plant runs on the same technology platform as Hydro's Husnes plant in Norway, where the company recently announced a reopening and technological upgrade of the plants' second electrolysis line.
"We see great potential in exchanging competence and technology elements between our aluminium plants. We are now running a technology pilot in Norway, which aims to be the world's most energy efficient and climate friendly aluminium production facility. These innovations will be expanded to other Hydro facilities, and as part of Hydro, ISAL will benefit from such technological spin-offs and competence," Hydro primary metal business area head Hilde Merete Aasheim commented.
In accordance with French and Dutch law, Hydro's offer triggers a statutory consultation with Rio Tinto employees and other stakeholders. Hydro said that it expected the transaction to be finalised in the second quarter of this year, given successful consultations and approval from the EU competition authorities.