Century Aluminum acquires full ownership of Holly's South Carolina plant

Century Aluminum will take full control of the 229,000 tpa capacity of Holly's South Carolina aluminum smelter as part of an agreement with co-owner Alcoa to acquire the facility for $ 67.5 million in cash. The deal, which will increase Century's North American capacity and add value to its product portfolio, is slated to close before the end of the year.

Under the terms of the agreement, Chicago-based Century is to acquire Alumax in South Carolina, a subsidiary of Alcoa and owner of Alcoa's 50.3 percent stake in Holly. Century already controls the remaining 49.7 percent. The deal allows Century to increase the supply of aluminum to the automotive, aerospace, and refrigeration chillers and other key industries throughout South Carolina and the United States.

Bob Wilt, president of Alcoa Global, said that while Holly is "a strong target, its cost structure does not meet Alcoa's criteria for a low-cost asset portfolio." The sale, he added, will help to implement "a strategy to optimize product portfolio and protect jobs at the site." The fact is that the current electricity costs of the smelter are among the highest in the United States and should be reduced thanks to a new electricity deal for 2015 if negotiations with the state-owned electricity company are successful.

The sale price of $ 67.5 million compares to the $ 60 million Century paid two years ago to acquire the 205,000-tonne Sebree aluminum smelter in western Kentucky from Rio Tinto Alcan. Century owns primary aluminum production facilities in the United States and Iceland.