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Century To Acquire Alcoa's California Cast Aluminum Plate Business
MONTEREY, CA., and PITTSBURGH, Pa.--December 23, 1998--
Century Aluminum Company (NASDAQ: CENX) and Alcoa (NYSE: AA) announced
today that Century has reached an agreement to acquire the cast aluminum
plate business of Alcoa based in Vernon, California. The acquisition is
subject to prior approval by the U. S. Department of Justice. The terms
of the transaction were not disclosed.
Alcoa is required to sell the business under the terms of its agreement
with the U.S. Department of Justice that cleared the way for the company
to acquire Alumax Inc. The business has annual revenues of nearly $30
million. The acquisition is immediately accretive to Century's net
income.
The business will be named Century Cast Plate, Inc. and operate as a
wholly owned subsidiary of Century. The plant, with 110 employees, has
capacity to produce about 15 million pounds a year of cast and machined
aluminum plate. Recent investments totaling $11 million have made the
plant a technically advanced, low-cost producer of the widest range of
cast aluminum plate products in the world.
Century is a leading producer of rolled aluminum plate and operates some
of the largest plate-making equipment in the world at its large
integrated rolling operations at Ravenswood, WV. Earlier this year
Century completed a $28-million project that doubled, to 50 million
pounds a year, the plant's capacity to produce heat-treated plate which
is used widely in the aerospace industry.
In addition to land, buildings and equipment, the assets being acquired
include intellectual property that allows Century to continue operating
the business at current levels.
Announcing the transaction, Century Chairman Craig A. Davis said: "This
acquisition is highly complementary to Century's existing rolled plate
business. With a broad product line and total annual plate capacity of
about 70 million pounds, we now have new opportunities to expand our
presence in plate markets, especially in Europe where the cast plate
division sells about 25 percent of its production. We also have
identified cost-saving synergies that involve production and metal
sharing arrangements between the Ravenswood and Vernon plants." Century
produces primary aluminum and a broad range of aluminum sheet and plate
products. Its principal subsidiary is Century Aluminum of West Virginia,
Inc., which operates a reduction plant and rolling mill at Ravenswood,
WV. Century also owns a 26.67 percent interest in an aluminum reduction
plant at Mt. Holly, SC.
Founded in 1888, Alcoa is the world's leading producer of aluminum and
alumina and a major participant in all segments of the industry: mining,
refining, smelting, fabricating and recycling. Alcoa serves customers
worldwide in the packaging, automotive, aerospace, construction and
other markets with a great variety of fabricated and finished products.
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