Arconic Corporation, headquartered in Pittsburgh, PA, entered into a definitive agreement to be acquired by funds managed by affiliates of Apollo Global Management, Inc. The all-cash transaction, valued at around $5.2 billion, includes a minority investment from funds managed by affiliates of Irenic Capital Management. Upon completion of the transaction, the company’s shares will no longer trade on the New York Stock Exchange, and Arconic will become a private company.
Founded in 2016, when Alcoa separated into two independent companies, Arconic is a manufacturer of aluminum sheet, plate and extrusions that are utilized in the automotive, aerospace, commercial transportation, industrial, packaging, and building and construction markets.
“In the more than three years since we became a standalone company, we have shown the capabilities and potential of Arconic’s employees and assets,” said Tim Myers, chief executive officer of Arconic. “Our unique product portfolio in an industry with significant potential for growth across the markets we serve positions us to deliver substantial value to our customers and the end users of our products. This transaction will provide Arconic with the backing of one of the world’s premier investment firms and will allow us to leverage Apollo’s industry expertise and relationships to pursue our long-term strategic goals. I look forward to working with their team to create opportunities for our employees and provide value to our customers.”
The acquisition by Apollo will enable Arconic to make strategic investments. This includes upgrades to key machine centers to maximize the full potential of the company’s unique production capabilities and technology upgrades to bring its plants and process controls to state-of-the-art standards. In addition, the investments will include projects to provide a cleaner environment in the communities in which the company operates.
“Arconic’s talented management team and employees operate a set of premier global assets serving markets that are growing. We are committed to investing significant capital in the company to secure its competitive position and world-class product offering to continue building on Arconic’s journey,” said Gareth Turner, a partner at Apollo Global Management. “As aluminum continues to win share in markets seeking sustainable, high-performing material across a wide variety of applications, we believe there is a strong runway for growth in markets throughout the world. We are looking forward to supporting Arconic’s experienced team with our resources and knowledge in the sector to help the Company achieve its long-term goals.”
Itai Wallach, a partner at Apollo, added, “We have tremendous respect for Arconic and its people and are fully committed to continuing Arconic’s unwavering support for its employees throughout the world through a strong culture of employee engagement, respecting and protecting the collective bargaining process and by focusing on strengthening the security of the company’s pension plans, such that the company’s commitments remain secure. We look forward to partnering with the company in its next phase of growth.”