The Hindalco Novelis merger marks one of the biggest mergers in the aluminum industry. The deal was a significant step in Hindalco’s aim of. Kumar Mangalam Birla on Aleris buy, Voda-Idea merger and cement Why would you say Aleris is a perfect fit for Novelis and Hindalco?. Mumbai: Hindalco Industries Ltd has offered to buy Novelis Inc. in a $6 billion all- cash deal that will marry the world’s 13th largest maker of aluminium with a.

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It has 13 very hi-tech manufacturing sites across Europe, the US and China. Novelis will operate as a subsidiary of the Company. The second of the initiatives was a brownfield expansion of facilities at a cost of Rs.

Get instant notifications from Economic Times Allow Not now You can switch off notifications anytime using browser settings. For Hindalco to build such a big market presence as that of Novelis by its own would had taken a very long time, which is the reason why this would be a very advantageous move for Hindalco as far as company strategy is concerned. Along with this, if the aluminum prices go down in the coming months, it would add to the profitability of the group companies. Novelis shareholders approved the transaction at a special meeting on May This transaction is completely financed on the balance sheet of Novelis and that is hugely value creating.


Hindalco Novelis Merger

Kamlesh Rao, Kotak Securities. Acquisition of Terapia, Romania by Ranbaxy Laborat In the words of Mr.

A key tenet of Hindalco’s strategy is continuous growth. The most important synergy that the companies can be looking for hindxlco this merger is the fact that Novelis is a producer of aluminum products whereas Hindalco is the lowest cost base metal producer in the world as far as aluminum is concerned. My Saved Articles Sign in Sign up. Please contact for further details. Inthe company acquired a The deal inclusive of all debts was valued approximately at 6 billion US dollars. It is a widely held company and its shareholders are largely hedge funds and institutional investors.

The risk associated in the merger of these two entities is perceived to be a little higher on account of the sheer size of the two companies.

So there is a possibility that the performance of the two novrlis may be completely opposite to each other. Telecom market to stabilise, grow at robust pace, says DoT secy. This deal made Hindalco one of the leading players in the global aluminum industry.

Hindalco to acquire Novelis for $6 bn

Novelis is also the world leader in the recycling of used aluminum beverage novellis. From the performance reports, meerger was evident that Novelis had incurred huge losses which will tend to decrease as most of its contracts with tapped prices will get over by the end of Hindalco plays no role at all in the financing for this transaction. Novelis was the second largest company in aluminum recycling in North America and the leader in production of rolled products in Europe, South America and Asia Pacific.


About Novelis Novelis is the world leader in aluminum rolling, producing an estimated 19 percent of the world’s flat-rolled aluminum products. Each share of Novelis was valued at For Hindalco, technology and process leadership, cost-effective manpower and ready market will help nobelis the cost structures and balance the pressure on the bottom lines. The ratio is at present at 0. Novelis is a global leader in the production of aluminum rolled products market.

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KVSSNRao’s Handbook of Mergers and Acquisitions: Acquisition of Novelis by HIndalco – Case Study

According to this contract, Novelis will hindaldo cans at a price which is tapped, beyond which Novelis will incur the cost. How does Novelis finance this transaction? Reasons Behind Merger and Acquisition.