Mergers: Commission approves proposed creation of an aluminium extrusion joint venture by Alcoa and Orkla

The European Commission has cleared under the EU Merger Regulation the proposed creation of a joint venture by Alcoa and Orkla's subsidiary Sapa in the field of aluminium soft alloy extrusions. After examining the operation, the Commission concluded that the transaction would not significantly impede effective competition in the EEA or any substantial part of it.

Alcoa is a New York stock exchange listed undertaking that is globally active in all the major segments of the aluminium business, including primary aluminium, soft- and hard- alloy extrusions, flat rolled products and building systems.

Orkla is a Norwegian group listed on the Oslo Stock Exchange that operates globally within the branded consumer goods, specialty materials, aluminium, energy and financial investment sectors.

Both parent companies will contribute to the joint venture their entire soft alloy extrusion businesses, including production facilities and employees. The soft alloy aluminium extrusions business that Orkla's wholly-owned subsidiary, Sapa AB is contributing to the joint venture has 18 facilities in 12 countries and approximately 6,000 employees. The soft alloy aluminium extrusion business that Alcoa is contributing to the joint venture has 22 facilities in eight countries and approximately 6,400 employees.

Soft alloy extrusions are alloy profiles that are used in industries such as building industries and car industries. The Commission's examination of the deal showed that for the products concerned, the joint venture would continue to face several strong, effective competitors in the EEA after the proposed creation of the joint venture. Moreover, the JV would be exposed to increasing competition from outside the EEA.