Hindalco Industries to acquire Novelis Inc.

Hindalco Industries to acquire Novelis Inc.

India based Hindalco Industries Ltd. has said in a statement that they are acquiring Novelis Inc. through an all-cash deal that values the Canadian company at $3.5 billion.

Hindalco Chairman K.M. Birla added that this deal would help them gain access to new technology and markets. It is also likely to help them double its turnover to $20 billion.

The price Hindalco is paying for the company is a premium of 16.7 percent over the company’s closing price on Friday.

Birla said in a statement on his decision to acquire Novelis: “When we are acquiring a world leader, one would have to pay a premium. It is very reasonable.”

He further added that it would take a decade to build comparable assets.

Birla further said that the cost of the acquisition, including Novelis’ debt would come to around $5.9 billion.

Novelis has customers including some big names like Coca Cola, General Motors and Ford Motor Co.