Alcoa Completes Sales Of Two Upstream Assets
Alcoa (NYSE: AA) today announced that it has completed two previously-announced sales within its Global Primary Products portfolio. The divestitures, one in the United States and the second in Jamaica, are aligned with Alcoa's strategy to lower its cost base and create a globally competitive business.
Alcoa World Alumina and Chemicals (AWAC) finalized the sale of its 55 percent ownership stake in the Jamalco bauxite mining and alumina refinery joint venture to Noble Group Ltd. The Company completed the sale, announced on October 15, 2014, after receiving all regulatory approvals. Jamalco is located in Clarendon, Jamaica.
AWAC will continue as Jamalco's managing operator for three years under a compensated service agreement and employees remain employed by Jamalco. AWAC is the joint venture owned 60 percent by Alcoa and 40 percent by Alumina Limited of Australia.
Alcoa also finalized the sale of its 50.3 percent interest in the Mt. Holly aluminum smelter in Goose Creek, South Carolina, to Century Aluminum Company. The smelter has the capacity to produce 229,000 metric tons of aluminum annually. Alcoa announced its plan to sell its stake to Century on October 23, 2014.
Both sales are in line with Alcoa's strategy to create a globally competitive commodity business. In its Primary Metals business, the Company has curtailed, closed or sold 1.3 million metric tons, or 31 percent of its highest cost global smelting capacity since 2007. At Alcoa's 2014 Investor Day, the Company reaffirmed its goal to lower its position on the global aluminum cost curve by five percentage points from the 43rd percentile to the 38th percentile by 2016. In its Alumina business, the Company said that its position on the alumina cost curve had improved to the 25th percentile in 2014 from the 27th percentile in 2013. Alcoa also reaffirmed its goal to further improve that cost position to the 21st percentile by 2016.
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