Mergers and acquisitions in the primary aluminum market are a challenge at current high prices for the metal, Dick Evans, president and chief executive of Alcan Inc. (AL), said Wednesday.
"The challenge is that at today's relatively high prices for aluminum, quality assets attract a high premium," Evans said on a conference call.
This makes it hard to do a deal, he added.
That's not to say primary aluminum sector consolidation isn't possible, however.
"The industry isn't evenly concentrated yet, and there's room within the constraints of antitrust legislation for further M&A activity," Evans said. "We could see some consolidation, but it'll be hard to make the numbers work at today's prices and premiums."
In contrast, consolidation in the downstream aluminum industry is more likely with continued discussions among companies active in semi-fabricated products, Evans noted.
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