Corus Group and Aleris International have announced that they have signed a Letter of Intent for the proposed acquisition by Aleris of Corus’ downstream aluminium rolled products and extrusions businesses for a gross consideration of €826m (£570m).
Corus’ equity stakes in its Canadian and Chinese joint ventures are also included within the proposed transaction. Corus’ smelting operations would remain within Corus and would supply Aleris under a long-term agreement. Corus and Aleris would also enter into an agreement related to research, development and technology.
Internal consultation and advice processes related to the transaction have commenced. It is intended that a Sale and Purchase Agreement would be entered into once these processes are completed. The proposed transaction would be subject to certain external regulatory clearances.
The net disposal proceeds, after deducting pension liabilities but excluding minority interests and net debt, would be approximately €728m (£502m). These proceeds would be used to further strengthen both the Group’s balance sheet and the development of the carbon steel business.
Philippe Varin, Chief Executive of Corus said, “The proposed sale of the downstream aluminium operations to Aleris secures a strong future for these businesses, represents good value for Corus and is an important step in the Group’s strategy.”