Platinum Equity on September 14 announced that it has signed a definitive agreement to purchase controlling interest in the Alcan Cable division of Rio Tinto. Alcan Cable, a division of the Alcan Engineered Products business, is a high-quality manufacturer of aluminum cable products.
Financial terms of the acquisition were not disclosed. The transaction is expected to be completed in the next several weeks pending the completion of certain closing conditions.
“Alcan Cable is an excellent fit for Platinum’s operations-focused, long-term approach to creating value,” said Brian Wall, a partner at Platinum who is leading the transaction. “We’re excited to work closely with Alcan Cable’s talented employees, valued customers and other important stakeholders in partnership with Rio Tinto.”
Following a successful close of the transaction, Platinum will assume management control of Alcan Cable and hold a 56 percent ownership stake in the company. Rio Tinto will retain a 44 percent minority interest and will remain a key supplier of aluminum rod and molten aluminum to the business.
“This transaction offers a unique divestiture solution to Rio Tinto,” Wall explained. “Platinum will acquire a majority stake in a non-core asset, execute a carve-out, transition the business to a standalone entity, and provide Rio Tinto an opportunity to participate in the future recovery of the business without having to manage that recovery themselves.”
Alcan Cable, headquartered in Atlanta, serves the utility transmission and distribution, and residential and non-residential construction markets throughout North America. The business has seven production sites in the U.S., Canada and most recently China.