Norsk Hydro Nets Vale Assets

Norsk Hydro said it has agreed to buy the aluminum business of Brazil's Vale  in a $4.9 billion deal that will give the company a huge supply of raw materials.

Norsk Hydro is already Europe's third-largest producer of aluminum. The deal with Vale adds the company's Paragominas mine, along with its aluminum refining and production facilities in Brazil, into the fold for Norsk.

The Norwegian metal producer will pay a $1.1 billion cash component and the remainder in stock that gives Vale a 22% stake in the business. Norsk will also assume $700 million in debt. The Norwegian government's stake in the company will fall to 34.5% from 43.8% to 34.5%. The deal is expected to close in the fourth quarter.