Rio Tinto to Sell Scottish Aluminum Assets for $410 Million
November 23 2016 - 6:58AM
Dow Jones News
By Alex MacDonald
LONDON--Rio Tinto PLC (RIO) said Wednesday it has agreed to sell
its aluminum-related operations, including a smelter and hydro
power plant in Scotland, to privately-owned SIMEC for $410 million,
or GBP330 million, fulfilling an earlier plan to dispose of some of
its less profitable aluminum operations.
The sale comprises the sale of Rio Tinto's Alcan Aluminium UK
Ltd. unit, which includes the operating aluminum smelter at Fort
William, the hydroelectric facilities at Kinlochleven and Lochaber
as well as all associated land.
SIMEC's intention is that the smelter will be operated by
commodities firm Liberty House Group, its sister company within the
international GFG Alliance, a holding company founded and owned by
Indian business tycoon Sanjeev Gupta.
Mr. Gupta this year acquired two steel mills in Scotland from
India-based Tata Steel Ltd. (500470.BY) and had planned to make a
bid for Tata's remaining U.K. operations, largely in Wales, before
Tata entered exclusive talks with another steelmaker, Germany's
ThyssenKrupp AG (TKA.XE) to create a European joint venture.
"This is a significant boost to our renewables portfolio and
will be another major step towards reducing our carbon footprint in
metals production," said Mr. Gupta, chairman of GFG Alliance.
Subject to all necessary agreed processes, the deal will
safeguard 150 jobs and has the potential to create hundreds more,
Mr. Gupta said.
The agreement includes a payment on completion of GBP180
million, plus an additional payment of GBP150 million no later than
Feb. 28, 2017.
Write to Alex MacDonald at alex.macdonald@wsj.com
(END) Dow Jones Newswires
November 23, 2016 06:43 ET (11:43 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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