Alcoa agrees to buy South32’s aluminium assets for $4.1bn up front

Alcoa will pay $3.1bn in cash and about $1.0bn in shares for South32’s stakes in the Worsley refinery and its bauxite mine in Australia, the Hillside smelter in South Africa and bauxite, alumina and aluminium assets in Brazil. A contingent value right could add up to $750m if prices rise. The Mozal smelter is excluded.

Why it matters. A contingent value right lets buyer and seller share the upside if metal prices beat expectations.

Source

Alcoa

In the course

Module 9: The M&A process