A February deal between Norwegian aluminium firm Norsk Hydro A.S.A. and Anglo-Australian mining giant Rio Tinto Group to buy Rio Tinto Iceland Ltd. (ISAL), a 53-percent stake in Dutch anode facility Aluminium & Chemie Rotterdam B.V. (Aluchemie) and a half interest in Swedish aluminium fluoride plant Alufluor AB (Alufluor) to for US$345 million is no longer on the table.
Per a press release issued by Norsk Hydro on Friday, the two parties signed an agreement to cease the acquisition process, citing the extended time-frame required for the European Commission (EC) competition approval process. Hydro indicates that it moved for termination of the deal after “considering alternative timelines, outcomes and developments.” As a result, Hydro withdrew the EC competition filing as well.
The deal began officially when Hydro tendered a binding offer to Rio Tinto for ISAL and its 53-percent interest in Aluchemie and half interest in Alufluor. The parties signed a Sale and Purchase Agreement in June after successful consultations with the Rio Tinto workforces in France and the Netherlands.
At the time the deal was announced, Hydro touted the deal as helping it meet several goals. With a yearly output of 210 thousand metric tons per annum of liquid metal and 230 thousand metric tons per annum of extrusion ingot, the acquisition of ISAL’s operations will help shore up Hydro’s dominant position as the premier supplier of extrusion ingot on the European continent.
In addition, the acquisition of ISAL would have added another 210 thousand metric tons per annum of aluminium capacity produced via renewable energy, bumping Hydro’s total capacity of primary aluminium production to 2.4 million metric tons per annum, with over 70 percent of that output fueled by renewable energy sources.
The move was also seen as step in the direction of Hydro operating as a fully-integrated aluminium company with a solid asset base, a flexible portfolio, and global sustainable operations.