By Svea Herbst-Bayliss and Chibuike Oguh
March 31 (Reuters) - Sachem Head Capital Management has
amassed a stake in Arconic Corp and has been pushing
the U.S. aluminum sheet maker to go through with a process it
has launched to sell itself, according to people familiar with
the matter.
Arconic has been in talks with private equity firms,
including Apollo Global Management Inc , about selling
itself, the sources said, at a time when securing debt financing
for leveraged buyouts has become challenging following this
month's jitters in the banking sector.
Apollo has so far indicated it is willing to pay $27 to $28
per share for Arconic, one of the sources said, close to where
Arconic's shares are trading currently. Sachem Head's push for a
sale would raise the pressure on Arconic to complete the
negotiations successfully.
Bloomberg News on Thursday reported the buyout price Apollo
was considering. Arconic shares have risen more than 20% since
the Wall Street Journal reported on Feb. 28 that the Pittsburgh,
Pennsylvania-based company was working with investment banks on
a sale process. Arconic now has a market value of $2.6 billion
and had debt as of the end of December of $1.6 billion.
The Reuters sources requested anonymity because the matter
is confidential. Arconic did not respond to a request for
comment, while Sachem Head and Apollo declined to comment.
The hedge fund, run by Scott Ferguson, established its
position in Arconic, which has not been previously reported, in
the last weeks, the sources said. The position's size could not
be determined.
Ferguson has told Arconic's management that he would like
the company to sell itself and would be supportive of a sales
process, the sources said.
Arconic also tried to negotiate a deal in 2019 with Apollo,
without success. In 2020, it split into two companies: Howmet
Aerospace Inc , a provider of jet engine components and
aerospace fastening systems, and Arconic, which makes aluminum
sheet, plate and extrusions for the aerospace and construction
industries.
Sachem Head has launched corporate battles at several
companies, including at US Foods Holding Corp , where it
reached a settlement for board seats last year, and the
company's CEO left after pressure from the hedge fund.
(Reporting by Svea Herbst-Bayliss and Chibuike Oguh in New
York; Editing by Bill Berkrot)
Messaging: svea.herbst.thomsonreuters.com@reuters.net))
