Aluminium Bahrain (Alba) has agreed to acquire Aluminium Dunkerque, the European Union’s largest aluminum smelter, in a deal valued at about $2.2 billion, the company said on Tuesday.
French state-backed investment bank Bpifrance is set to take a 6% stake for €100 million ($116.5 million), under a memorandum of understanding signed on the sidelines of the Choose France Summit.
Bpifrance will have a seat on the board of Aluminium Dunkerque’s holding company.
Alba said the acquisition, expected to close this year, would be fully financed by a consortium of its banking partners.
Aluminium Dunkerque produces about 300,000 metric tons of aluminum a year.
Alba’s existing plant in Bahrain has a capacity of 1.6 million tons, though the company has reduced output since the start of the Iran war.
French Trade Minister Nicolas Forissier called the acquisition “good news” in supporting investment, jobs, competitiveness and decarbonization, according to his office.
The CGT union welcomed Alba’s plans and Bpifrance’s investment, Johan Vlietinck, a CGT union official at Aluminium Dunkerque, said, adding: “There are no longer any European firms that would be able to ensure Aluminium Dunkerque’s development.”
Citi analysts said in a note that the deal should bring Alba geographical diversification and higher core earnings, adding that the group had a strong balance sheet.
Alba entered exclusive talks earlier this year to acquire the smelter from US investment fund American Industrial Partners.
($1 = 0.8587 euro)
(By Hugo Lhomedet, Gus Trompiz and Pratima Desai; Editing by Thomas Derpinghaus and Matthew Lewis)
