Alcoa to Sell Stake in Smelter to Century Aluminum
Alcoa reached an agreement to sell its ownership stake in the Mt. Holly aluminum smelter in Goose Creek, S.C., to Century Aluminum for $67.5 million plus an additional potential earn-out. Mt. Holly is now owned 50.3% by Alcoa and 49.7% by Century. The smelter has the capacity to produce 229,000 metric tons of aluminum per year and employs 500 people, who will all transition to Century as part of the deal. The sale, which is expected to close by the end of the fourth quarter 2014, will reduce Alcoa’s global smelting capacity to 3.5 million metric tons per year.
The sale is aligned with Alcoa’s strategy to create a globally competitive commodity business and lower its position on the world aluminum production cost curve to the 38th percentile by 2016. Including this announcement, Alcoa has curtailed, closed or sold 1.3 million metric tons (31%) of its highest-cost global smelting capacity since 2007. According to Alcoa, the deal will protect the facility’s jobs and economic contribution to the local community.