Novelis Inc. announced that it can close its acquisition of Beachwood-based Aleris Corp., but the Atlanta-based company must divest Aleris’ Lewisport, Kentucky plant as part of its agreement with the U.S. Department of Justice. Novelis can close the acquisition prior to divesting those assets once it obtains European Commission approval of the buyer for Aleris’ plant in Duffel, Belgium.
The arbitrator assigned to resolve Novelis’ dispute with the DOJ ruled that aluminum and steel are not in the same relevant product market for automotive body sheet under antitrust laws, but still insisted on the divestiture.
"This decision ignores the reality of the automotive body sheet market and the competition we have faced against steel for years,” Novelis President and CEO Steve Fisher said in a statement. “Aluminum remains the material of choice for our customers, and we are going to continue to provide them with the innovative, lightweight and sustainable solutions they demand. We are moving forward with the acquisition of Aleris to realize the many benefits this transaction will bring to our employees, customers and the aluminum industry as a whole."
Novelis intends to proceed with the divestiture of Aleris’ North American automotive business, including the Lewisport, Kentucky plant. Once the company receives EC approval for the buyer of Aleris’ Duffel plant, Novelis intends to close the transaction as quickly as possible.
The $2.6 billion acquisition of Aleris, a global supplier of rolled aluminum products, was first announced in July 2018.
