Difference between revisions of "Norway apos;s Hydro In 3.2 Bln Deal For Aluminium Firm Sapa"

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<br>By Terje Solsvik and Ole Petter Skonnord<br> <br>OSLO, July 10 (Reuters) - Norwegian metals firm Norsk Hydro will take full ownership of aluminium products maker Sapa by buying a 50 percent stake from conglomerate Orkla , the companies said on Monday.<br> <br>The transaction values Sapa, at 27 billion Norwegian crowns ($3.24 billion) on a debt-free basis.<br> <br>"Sapa will enable us to assume global leadership, establish a platform for growth, and provide responsible operations and sustainable solutions for the future low-carbon economy," Hydro Chief Executive Svein Richard Brandtzaeg said.<br> <br>While Hydro itself produces primary aluminium from scratch, [https://www.kynghidongduong.vn/tours/tour-du-lich-sapa-tu-ha-noi-3-ngay-2-dem-2-ngay-1-dem-tour-sapa-ban-cat-cat-fansipan-thac-bac-ham-rong-tour-sapa-gia-re.html tour sapa] cuts, presses and shapes the metal, making it a key supplier to aircraft makers, automotive firms and the construction industry.<br> <br>"The combination will make Hydro the only global company in the aluminium industry that is fully integrated across the value chain and markets," Hydro said.<br> <br>Hydro predicted it would see annual synergies of 200 million crowns, and that the deal would immediately be accretive to earnings and  [https://www.kynghidongduong.vn/tours/tour-du-lich-sapa-tu-ha-noi-3-ngay-2-dem-2-ngay-1-dem-tour-sapa-ban-cat-cat-fansipan-thac-bac-ham-rong-tour-sapa-gia-re.html kynghidongduong.vn] secure strong cash generation.<br> <br>Jointly owned by Orkla and Hydro since 2013, Sapa has 22,400 employees and in 2016 recorded sales of 53 billion crowns.<br> <br>Orkla had previously said it would eventually sell its stake, either directly to Hydro or through an initial public offering.<br> <br>"For Norsk Hydro, we consider the transaction to be consistent with the strategy to be an integrated aluminium player," Pareto Securities wrote in a note to clients, adding the transaction valued Sapa 3.6 percent below its own forecast.<br> <br>Completion of the transaction is subject to approval from competition authorities in Brazil, Canada, China, Turkey and the European Union, and is expected in the second half of 2017, Hydro and Orkla said.<br> <br>Danske Bank wrote in a note to clients that the regulatory risk to the deal was low.<br> <br>"For Orkla, the sale is a natural consequence of our strategy of becoming a focused branded consumer goods company," Orkla Chief Executive Peter Ruzicka said in a statement.<br> <br>Hydro said it was committed to retain its investment grade rating after the purchase, and that its dividend policy would be unchanged.<br> <br>"The transaction will be financed through cash positions and issuance of bonds in Norwegian and international markets," it said.<br> <br>"Hydro will maintain its dividend policy of returning 40 percent of net income over the (business) cycle, with NOK 1.25 per share seen as a floor in 2017," it said.<br> <br>Orkla separately said it would pay a special dividend of 5 Norwegian crowns per share when the deal closes.<br> <br>The firm has shed several large businesses in recent years, including breweries and chemicals making, but will continue to build up its remaining operations through acquisitions and investments.<br> <br>"We find it positive that Orkla is finally selling," Danske Bank analyst Martin [http://www.empowher.com/search/site/Stenshall%20wrote Stenshall wrote] in a note to clients, adding the price Hydro would pay was 1.9 percent above his estimated valuation of Sapa.<br> <br>Danske Bank reiterated a "hold" recommendation on Orkla's shares.<br> <br>Hydro shares traded 1.4 percent higher for the day at 0726 GMT, while Orkla rose 1.8 percent.<br> <br>($1 = 8.3418 Norwegian crowns) (Editing by Niklas Pollard and Jason Neely)<br>
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<br>By Terje Solsvik and Ole Petter Skonnord<br> <br>OSLO, July 10 (Reuters) - Norwegian metals firm Norsk Hydro will take full ownership of aluminium products maker Sapa by buying a 50 percent stake from conglomerate Orkla , the companies said on Monday.<br> <br>The transaction values Sapa, at 27 billion Norwegian crowns ($3.24 billion) on a debt-free basis.<br> <br>"Sapa will enable us to assume global leadership, establish a platform for growth, and provide responsible operations and sustainable solutions for the future low-carbon economy," Hydro Chief Executive Svein Richard Brandtzaeg said.<br> <br>While Hydro itself produces primary aluminium from scratch, Sapa cuts, presses and shapes the metal, making it a key supplier to aircraft makers, automotive firms and the construction industry.<br> <br>"The combination will make Hydro the only global company in the aluminium industry that is fully integrated across the value chain and markets," Hydro said.<br> <br>Hydro predicted it would see annual synergies of 200 million crowns, and that the deal would immediately be accretive to earnings and  [https://www.kynghidongduong.vn/tours/tour-du-lich-sapa-tu-ha-noi-3-ngay-2-dem-2-ngay-1-dem-tour-sapa-ban-cat-cat-fansipan-thac-bac-ham-rong-tour-sapa-gia-re.html tour du lịch sapa] secure strong cash generation.<br> <br>Jointly owned by Orkla and Hydro since 2013, [https://www.kynghidongduong.vn/tours/tour-du-lich-sapa-tu-ha-noi-3-ngay-2-dem-2-ngay-1-dem-tour-sapa-ban-cat-cat-fansipan-thac-bac-ham-rong-tour-sapa-gia-re.html tour sapa từ hà nội] has 22,400 employees and in 2016 recorded sales of 53 billion crowns.<br> <br>Orkla had previously said it would eventually sell its stake, either directly to Hydro or through an initial public offering.<br> <br>"For Norsk Hydro, we consider the transaction to be consistent with the strategy to be an integrated aluminium player," [https://www.sportsblog.com/search?search=Pareto%20Securities Pareto Securities] wrote in a note to clients, adding the transaction valued Sapa 3.6 percent below its own forecast.<br> <br>Completion of the [http://mommysavers.com/?s=transaction transaction] is subject to approval from competition authorities in Brazil, Canada, China, Turkey and the European Union, and is expected in the second half of 2017, Hydro and Orkla said.<br> <br>Danske Bank wrote in a note to clients that the regulatory risk to the deal was low.<br> <br>"For Orkla, the sale is a natural consequence of our strategy of becoming a focused branded consumer goods company," Orkla Chief Executive Peter Ruzicka said in a statement.<br> <br>Hydro said it was committed to retain its investment grade rating after the purchase, and that its dividend policy would be unchanged.<br> <br>"The transaction will be financed through cash positions and issuance of bonds in Norwegian and international markets," it said.<br> <br>"Hydro will maintain its dividend policy of returning 40 percent of net income over the (business) cycle, with NOK 1.25 per share seen as a floor in 2017," it said.<br> <br>Orkla separately said it would pay a special dividend of 5 Norwegian crowns per share when the deal closes.<br> <br>The firm has shed several large businesses in recent years, including breweries and chemicals making, but will continue to build up its remaining operations through acquisitions and investments.<br> <br>"We find it positive that Orkla is finally selling," Danske Bank analyst Martin Stenshall wrote in a note to clients,  [https://www.kynghidongduong.vn/tours/tour-du-lich-sapa-tu-ha-noi-3-ngay-2-dem-2-ngay-1-dem-tour-sapa-ban-cat-cat-fansipan-thac-bac-ham-rong-tour-sapa-gia-re.html kynghidongduong.vn] adding the price Hydro would pay was 1.9 percent above his estimated valuation of Sapa.<br> <br>Danske Bank reiterated a "hold" recommendation on Orkla's shares.<br> <br>Hydro shares traded 1.4 percent higher for the day at 0726 GMT, while Orkla rose 1.8 percent.<br> <br>($1 = 8.3418 Norwegian crowns) (Editing by Niklas Pollard and Jason Neely)<br>

Revision as of 23:32, 10 January 2021


By Terje Solsvik and Ole Petter Skonnord

OSLO, July 10 (Reuters) - Norwegian metals firm Norsk Hydro will take full ownership of aluminium products maker Sapa by buying a 50 percent stake from conglomerate Orkla , the companies said on Monday.

The transaction values Sapa, at 27 billion Norwegian crowns ($3.24 billion) on a debt-free basis.

"Sapa will enable us to assume global leadership, establish a platform for growth, and provide responsible operations and sustainable solutions for the future low-carbon economy," Hydro Chief Executive Svein Richard Brandtzaeg said.

While Hydro itself produces primary aluminium from scratch, Sapa cuts, presses and shapes the metal, making it a key supplier to aircraft makers, automotive firms and the construction industry.

"The combination will make Hydro the only global company in the aluminium industry that is fully integrated across the value chain and markets," Hydro said.

Hydro predicted it would see annual synergies of 200 million crowns, and that the deal would immediately be accretive to earnings and tour du lịch sapa secure strong cash generation.

Jointly owned by Orkla and Hydro since 2013, tour sapa từ hà nội has 22,400 employees and in 2016 recorded sales of 53 billion crowns.

Orkla had previously said it would eventually sell its stake, either directly to Hydro or through an initial public offering.

"For Norsk Hydro, we consider the transaction to be consistent with the strategy to be an integrated aluminium player," Pareto Securities wrote in a note to clients, adding the transaction valued Sapa 3.6 percent below its own forecast.

Completion of the transaction is subject to approval from competition authorities in Brazil, Canada, China, Turkey and the European Union, and is expected in the second half of 2017, Hydro and Orkla said.

Danske Bank wrote in a note to clients that the regulatory risk to the deal was low.

"For Orkla, the sale is a natural consequence of our strategy of becoming a focused branded consumer goods company," Orkla Chief Executive Peter Ruzicka said in a statement.

Hydro said it was committed to retain its investment grade rating after the purchase, and that its dividend policy would be unchanged.

"The transaction will be financed through cash positions and issuance of bonds in Norwegian and international markets," it said.

"Hydro will maintain its dividend policy of returning 40 percent of net income over the (business) cycle, with NOK 1.25 per share seen as a floor in 2017," it said.

Orkla separately said it would pay a special dividend of 5 Norwegian crowns per share when the deal closes.

The firm has shed several large businesses in recent years, including breweries and chemicals making, but will continue to build up its remaining operations through acquisitions and investments.

"We find it positive that Orkla is finally selling," Danske Bank analyst Martin Stenshall wrote in a note to clients, kynghidongduong.vn adding the price Hydro would pay was 1.9 percent above his estimated valuation of Sapa.

Danske Bank reiterated a "hold" recommendation on Orkla's shares.

Hydro shares traded 1.4 percent higher for the day at 0726 GMT, while Orkla rose 1.8 percent.

($1 = 8.3418 Norwegian crowns) (Editing by Niklas Pollard and Jason Neely)