Atlanta’s rolled and recycled aluminium firm Novelis announced yesterday that it has completed the sale of its ownership interest in its Ulsan, South Korea, plant to Kobe Steel, Ltd., establishing their joint venture Ulsan Aluminium, Ltd.
The plant in question, which Novelis sold to Kobe Steel for US$315 million, produces aluminium products for the automotive and construction markets. Located in the industrial city of Ulsan, the plant recently completed a significant expansion of its facilities, including the addition of a new three-stand hot finishing mill, a new pusher furnace, and new annealing furnaces.
As a result of the sale, Novelis and Kobe Steel now both have an ownership interest in the facility while both companies individually maintain their own metal supplies and commercial relationships. The entirety of the plant’s 600 employees now work for Ulsan Aluminium, and the sale will provide Novelis with cash proceeds and allow it to pay down a portion of its net debt load.
“This strategic partnership further supports Novelis’ continued commitment to growth in the Asian automotive industry and creates new capabilities to meet the increasing demand for aluminum sheet,” explained President of Novelis Asia Sachin Satpute. “Through an increase in operational efficiencies and process enhancements, this partnership will provide our global customers greater access to the numerous benefits of aluminum.”
“Ulsan Aluminum is committed to providing first-class rolled aluminum products and services to benefit our customers in the region,” posited the President and CEO of Ulsan Aluminum, Ltd Jerry Quick. “We will continue to operate with a high-quality and safety-first mentality, and will support the local market with innovative aluminum products,”
Novelis is a subsidiary of Mumbai’s Hindalco Industries Ltd. Based in Atlanta, the firm accounts for almost half of Hindalco’s consolidated revenue. The world’s largest recycler of aluminium, Novelis conducts operations in ten different countries, employs around twelve thousand people, and reported US$10 billion in revenue for the most recent fiscal year.