By Elias Schisgall
Alcoa will acquire a set of interests in mining and processing assets from South32 for about $4.1 billion in cash and stock.
The deal includes stakes in a bauxite mine, alumina refinery, and aluminum smelter operations, Alcoa said Tuesday. It has an enterprise value of about $4.7 billion when including net debt.
Alcoa will pay South32 $3.1 billion in cash upfront, along with around 17 million newly issued shares valued at around $1 billion. The company also agreed to give South32 a contingent value right worth up to $750 million.
The deal is also supported by an initial $3.1 billion bridge commitment from Goldman Sachs, the company said.
Alcoa expects the transaction to be accretive to earnings per share and free cash flow immediately after closing, which is expected to take place in the first half of 2027.
The transaction will establish Alcoa's presence in South Africa and add to its investments in Australia and Brazil, the company said.
"These high-quality, globally relevant assets are a strong strategic fit within our portfolio and align directly with our strengths as a leading pure-play upstream aluminum company," Chief Executive Officer William Oplinger said. "With our proven operating model and global capabilities, we are well positioned to enhance performance, unlock value, and support their long-term success within Alcoa."
Write to Elias Schisgall at elias.schisgall@wsj.com