US proposes Novelis to divest automotive body sheet biz in North America
Prior to its acquisition by Novelis, Aleris was a Delaware corporation headquartered in Ohio. Aleris offers flat-rolled aluminum products to the automotive, aerospace, building and construction industries among others
- May 13, 2020,
- Updated May 13, 2020 9:54 AM IST
The US Department of Justice is proposing a federal court to order Hindalco-owned American company Novelis to divest Aleris Corporation's entire aluminum automotive body sheet operations in North America to satisfy the Department's competitive concerns with Novelis's acquisition of Aleris.
Novelis is a wholly-owned subsidiary of Hindalco Industries Limited, an Indian company headquartered in Mumbai.
Prior to its acquisition by Novelis, Aleris was a Delaware corporation headquartered in Cleveland, Ohio. Aleris offers flat-rolled aluminum products to the automotive, aerospace, building and construction industries among others.
"Today's proposed divestiture preserves competition in the market for aluminum automotive body sheet and protects automakers and American consumers by requiring the full divestiture of Aleris' North American aluminum automotive body sheet operations," Assistant Attorney General Makan Delrahim of the Justice Department's Antitrust Division said on Tuesday.
In 2018, Aleris' revenues were approximately USD 3.4 billion.
The proposed final judgment follows the US' March 9 arbitration win.
Prior to filing its civil antitrust lawsuit to block the merger, the Department's Antitrust Division reached an agreement with Novelis and Aleris to refer the matter to binding arbitration if Novelis and Aleris were unable to resolve the United States' competitive concerns with the transaction.
Under the arbitration terms, Novelis agreed to divest Aleris's aluminum automotive body sheet operations in North America if the United States prevailed in arbitration.
The arbitrator ruled for the United States, holding that aluminum automotive body sheet constitutes a relevant antitrust product market. Today, the Department filed a proposed final judgment that, if approved by the court, would fully resolve the competitive harm alleged in the lawsuit.
The Aditya Birla Group flagship Hindalco cemented its position as the world's largest producer of value-added aluminium products with the completion of the USD 2.8 billion acquisition of Aleris by its wholly-owned US subsidiary Novelis Inc last month.
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The US Department of Justice is proposing a federal court to order Hindalco-owned American company Novelis to divest Aleris Corporation's entire aluminum automotive body sheet operations in North America to satisfy the Department's competitive concerns with Novelis's acquisition of Aleris.
Novelis is a wholly-owned subsidiary of Hindalco Industries Limited, an Indian company headquartered in Mumbai.
Prior to its acquisition by Novelis, Aleris was a Delaware corporation headquartered in Cleveland, Ohio. Aleris offers flat-rolled aluminum products to the automotive, aerospace, building and construction industries among others.
"Today's proposed divestiture preserves competition in the market for aluminum automotive body sheet and protects automakers and American consumers by requiring the full divestiture of Aleris' North American aluminum automotive body sheet operations," Assistant Attorney General Makan Delrahim of the Justice Department's Antitrust Division said on Tuesday.
In 2018, Aleris' revenues were approximately USD 3.4 billion.
The proposed final judgment follows the US' March 9 arbitration win.
Prior to filing its civil antitrust lawsuit to block the merger, the Department's Antitrust Division reached an agreement with Novelis and Aleris to refer the matter to binding arbitration if Novelis and Aleris were unable to resolve the United States' competitive concerns with the transaction.
Under the arbitration terms, Novelis agreed to divest Aleris's aluminum automotive body sheet operations in North America if the United States prevailed in arbitration.
The arbitrator ruled for the United States, holding that aluminum automotive body sheet constitutes a relevant antitrust product market. Today, the Department filed a proposed final judgment that, if approved by the court, would fully resolve the competitive harm alleged in the lawsuit.
The Aditya Birla Group flagship Hindalco cemented its position as the world's largest producer of value-added aluminium products with the completion of the USD 2.8 billion acquisition of Aleris by its wholly-owned US subsidiary Novelis Inc last month.
Also read: Deciphering economic stimulus: What will revive economy, what won't!
Also read: Making sense of Rs 20 lakh crore stimulus package