Alcan must divest to acquire Pechiney

The US Department of Justice and the European Commission have reached a settlement with Alcan that requires the company to divest certain businesses if its pending $4.6 billion tender offer for Pechiney is successful.

The US Department of Justice (DOJ) and the European Commission have reached a settlement with Alcan that requires the company to divest Pechiney SA’s aluminium rolling mill in Ravenswood, WV, if its pending $4.6 billion tender offer for Pechiney is successful.

The tender offer, publicly announced in early July and recently endorsed by Pechiney’s board of directors, is expected to be completed in late November 2003.

The US DOJ said that the acquisition, as originally proposed, would substantially lessen competition in the development, production, and sale of brazing sheet, a class of custom-engineered aluminium alloy used in fabricating radiators, oil coolers, heaters, and air conditioning units for motor vehicles, and would likely result in higher prices.

The European Commission also reviewed the transaction and approved it subject to conditions that required Alcan to divest certain Alcan or Pechiney aluminium rolling mills in Europe.

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