US aluminium producer Alcoa has made a bid for its Australian partner Alumina, valuing the company at 3.35 billion Australian dollars ($2.2 billion).
Alcoa offered 0.02854 of its shares for Alumina, which implies a premium of 13% compared to the company’s closing price last Friday, Alcoa said in a press release.
Alumina’s board of directors has recommended shareholders accept the offer. Investment company Allan Gray Australia, which owns 19.9% of Alumina, has already expressed its willingness to sell its shares.
Alumina and Alcoa are partners in several projects. In particular, the companies jointly own the Alcoa World Alumina & Chemicals (AWAC) project, which mines bauxite and alumina.
Alumina shares jumped 6.9% in Sydney trading on Monday. Alcoa’s market capitalization has grown by 1.1% over the past three months, to $4.76 billion.