Alcan to acquire full ownership of cathode business in France

PARIS, France, Oct. 19 /PRNewswire-FirstCall/ - Alcan is in advanced discussions with GrafTech International Ltd (NYSE: GTI) to acquire the remaining 70 percent stake of Carbone Savoie and certain related technology and equipment for approximately US$130-140 million. Under the current structure, Alcan currently owns 30 percent of Carbone Savoie, a global leader in the design and production of cathode blocks. The proposed transaction will be submitted to the Works Council consultation process in France and is expected to be completed in the fourth quarter 2006, following regulatory approval. Final terms will be disclosed upon completion.
 
"This investment will strengthen Alcan's AP Series smelting technology platform and help to accelerate the development of potential breakthrough technologies," said Cynthia Carroll, President and Chief Executive Officer, Alcan Primary Metal Group. "It will also secure Alcan's supply of cathode products for our current operations and extensive new project pipeline," she added.
 
Today, Alcan's proprietary world-leading AP Series Smelting Technology already utilizes Carbone Savoie's advanced graphitized cathode blocks.
 
"In acquiring full ownership of Carbone Savoie, Alcan will strengthen its commitment to aluminum smelting technology development in Europe and more particularly in France," said Jean-Philippe Puig, President, Europe, Alcan Primary Metal Group. "Through Alcan's Integrated Management System (AIMS), which includes a rigorous approach to environment, health and safety (EHS FIRST), Carbone Savoie would be fully integrated into Alcan, benefiting customers, employees, and shareholders alike," he added.
 
With revenue of approximately US$114 million in 2005, Carbone Savoie is a leading and profitable producer of cathode blocks, including a growing share of graphitized cathode blocks, as well as sidewall blocks and ramming paste. Cathodes are essential to the production of aluminum, as they act as conductors in the electrolysis process. GrafTech's cathode business employs approximately 500 people at two sites, both in close proximity to Alcan's European Primary Metal headquarters and research and development centre in Voreppe, France.
 
Alcan Inc. (NYSE, TSX: AL) is a leading global materials company, delivering high quality products and services worldwide. With world-class technology and operations in bauxite mining, alumina processing, primary metal smelting, power generation, aluminum fabrication, engineered solutions as well as flexible and specialty packaging, today's Alcan is well positioned to meet and exceed its customers' needs. Alcan is represented by 65,000 employees in 61 countries and regions, and posted revenues of US$20.3 billion in 2005. The Company has featured on the Dow Jones Sustainability World Index consecutively since 2003. 
 
Statements made in this press release which describe the Company or management's objectives, projections, estimates, expectations or predictions may be "forward-looking statements" within the meaning of securities laws. The Company cautions that, by their nature, forward-looking statements involve risk and uncertainty and that the Company's actual actions or results could differ materially from those expressed or implied in such forward-looking statements or could affect the extent to which a particular projection is realized. Reference should be made to the Company's most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K for a list of factors that could cause such differences.