Alcoa's Alcan Bid May Delay South Africa Smelter

JOHANNESBURG--The proposed $2.7 billion Coega aluminum smelter near Port Elizabeth, South Africa, faces possible delays for a second time due to corporate takeover activity in the global aluminum sector, Business Report says Wednesday.

The newspaper says Alcoa Inc.'s (AA) hostile bid for Canada's Alcan Inc. (AL), if successful, will certainly delay the Coega project as the U.S. company integrates its new assets and reassesses the project's potential.

The same thing happened in 2003 when Alcan bought France's Pechiney, Coega's original developer.

However, Business Day reports that Coega and the Industrial Development Corp., which own stakes in the industrial development zone, have moved to allay concerns about the project's future.

IDC chief financial officer Gert Gouws was quoted as saying he had no doubt the project would go ahead, although he added his company has not as yet spoken to senior officers at Alcan.