Norwegian aluminium firm Norsk Hydro A.S.A. announced yesterday that its subsidiary Hydro Extruded Solutions AS has come to an agreement with U.S. value-added aluminium firm Arconic to purchase the latter’s twin aluminium extrusion plants in southern Brazil.
Hydro said the US$10-million deal will enhance the firm’s operations in the country. The two plants, located in Utinga and Tubarão, collectively employ over 600 individuals who operate one cast house, seven presses ranging in size from 7” to 14”, and other assorted value-added equipment.
President and CEO Svein Richard Brandtzæg greeted the transaction as a move that will ultimately benefit the firm’s customers.
“We believe in the integrated business model and Brazil is the country where Hydro’s entire value chain is present. From bauxite and alumina, via primary production to extruded solutions, this will strengthen our ability to serve our customers.”
Hydro’s EVP and head of Extruded Solutions Egil Hogna explained that the acquisition will
propel his firm to the top of Brazil’s aluminium-extrusion sector.
“We believe in the importance of being close to our customers to offer high quality customized extrusions and local support. With the acquisition of Utinga and Tubarão, Hydro will become the market leader in the Brazilian extrusion market.
Though the two firms have already agreed upon the transaction, the deal still lacks approval from the Brazilian government. Hydro expects to clear this hurdle within the next few months.
Norsk Hydro, which was founded in 1905, financed by the Swedish Wallenberg family and French banks, began its life named Norsk hydro-elektrisk Kvælstofaktieselskab (literally, “Norwegian hydro-electric nitrogen limited”) by Sam Eyde. The Norwegian government owns approximately 40% of the company at the present time. Norsk Hydro is one of the largest aluminium companies in the world, with plants in Rjukan, Raufoss, Vennesla, Karmøy, Høyanger, Årdal, Sunndalsøra, and Holmestrand. Norsk also has several plants abroad, including in Germany and Brazil.