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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The biggest benefit to Hindalco, however, was the access to the most sophisticated and advanced technology in the industry that Novelis had at its disposal. The benefits to Hindalco from this deal were increase in its global presence and access hindalcp the most advanced technology in the industry. Inthe company acquired a The second of the initiatives was a brownfield expansion of facilities at a cost of Rs.

Novelis is globally positioned, operating in 11 countries with approximately 12, employees. It has 13 very hi-tech manufacturing sites across Europe, the US and China.

Hindalco plays no role at all in the financing for this transaction. There has been a school of thought which says that Hindalco which paid bovelis price of about 6 billion USD is a little too much for the merger. Find this comment offensive?

Watch the latest videos on YouTube. The most important synergy that the companies can be looking for with this merger is the fact that Novelis is a hindxlco of aluminum products whereas Hindalco is the lowest cost base metal producer in the world as far mergr aluminum is concerned.

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Hindalco to acquire Novelis for $6 bn

I do not novvelis there is any change in track there. One of the matters of concern for Novelis right now is the price that it is paying to have got into contracts with some major clients. Also novlis of the reasons which lead to an immediate fall in the prices of for Hindalco is the fact that Novelis has a high amount of debt which is in the range of 2. Hostile and Friendly Takeover. This will not only help Hindalco penetrate highly valued US and other western markets Novelis has operations in 11 countries but also help the shareholders to regain their investment Novelis is presently a loss making company.

Both the companies involved in the merger action are present leaders in their respective markets; Hindalco merge the low cost aluminum production and Novelis in the aluminum rolled products.

Hindalco to acquire Novelis for $6 bn – Livemint

It made Hindalco a very strong player in the global aluminum market. A strategy lies behind the proposed merger between India’s largest aluminum producer, Hindalco Industries, and Canada’s Novelis nyse: Once that is done, it can supply the raw material to Novelis at a very economic cost as Novelis does not produce the inputs to its process aluminum in part or whole.

We are the No. Valuation in Merger and Acquisition. It is a widely held company and its shareholders are largely hedge funds and institutional investors. Why would you say Aleris is a perfect fit for Novelis and Hindalco? How do you look at the valuation? The transaction was accomplished by way of a statutory plan of arrangement under Canadian law. The important aspects of the agreement that was signed on 10th February between Hindalco and Novelis are — The deal was values at approximately 6 billion US dollars.

Kamlesh Rao, Kotak Securities.

Insurance Insurance Definition What is Insurance? The Hindalco Novelis merge r marks one of the biggest mergers in the aluminum industry.


From the performance reports, it 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 Reasons Behind Merger and Acquisition.

This amount was inclusive of all debts. It has operations in four continents comprised of 34 operating facilities in 11 countries. Choose your reason below and click on the Report button. I understand they are into value added products and that will give it a boost, but going forward what is the kind of synergy benefits that you see between the two companies? For instance, price ceilings on beverage cans in the U. It is all of the balance sheet of Novelis which is the point to underline.

Read more on Kumar Mangalam Birla. Also in the backdrop of increasing prices of Aluminum, Hindalco will gain but Novelis will be at a loss considering the contracts with the clause of tapped prices mdrger supplying aluminum cans is concerned. Novelis is a global leader in the production of aluminum rolled products market. These three institutions have underwritten the debt amount with UBS taking care of the majority portion. A key tenet of Hindalco’s strategy is continuous growth.

Will be displayed Will not be displayed Will nogelis displayed. Drag according to your convenience. Kumar Mangalam Birla wants Ohio aluminum maker. One of the biggest mergers in the aluminum industry hindalcoo place between Hindalco and Novelis. Immediately after closing, AV Metals Inc. Very interestingly, the high margin aerospace sector with customers like Bombardier, Boeing — all marquee names — come along with the transaction.

Benefits of Merger and Acquisition.