NEW YORK - Alcoa , which has made a $28 billion hostile bid for Canadian rival Alcan Inc. , plans to go to antitrust authorities soon with a list of Alcan aerospace and automotive assets to sell if the deal goes forward, a source familiar with the situation said on Friday.
Antitrust questions would be raised particularly in those two areas by the merger, which would create the world's largest aluminum producer. The company plans to present the list to competition authorities in the European Union, United States and Canada, the source said.
The targeted divestitures include a handful of specific plants from Alcan, primarily in Europe, that make products for aerospace companies such as Boeing and Airbus, and that make brazing sheets, which are used in automotive applications, the source said.
The list was approved by Alcoa Chief Executive Alain Belda on Thursday, according to the source. Belda said last week at a conference that the company was considering selling assets in these areas.
"With these specific targeted plans, they are confident they can solve the competition issues," the source said.
The move is aimed at trying to minimize the time needed to get the deal completed, the source said, and at heading off issues that Alcan might raise when it responds to the offer.
Alcan, which has not yet commented on the offer, has until May 22 to respond to it.
Alcan was not available for comment on Friday.
While it is uncertain how Alcan will respond, Alcoa's offer is below what investors believe Alcan worth, largely because they expect a higher bid from Alcoa or a competing bid.
Alcoa's offer of $58.60 per share plus 0.4108 share of Alcoa was worth $74.92 per share at Friday's close, 8 percent below the $81.07 that Alcan traded at on the New York Stock Exchange.
Alcoa has addressed some potential political concerns about the offer. On Thursday, it said that it planned to keep Alcan's Quebec and global expansion projects and in a letter to Alcan's board, outlined how it would meet the company's obligations on investment in Quebec.
Industry sources have estimated that, combined, Alcoa and Alcan control about 70 percent of the aerospace market.
Brazing sheet is material made of two alloys that is used to create a bond in heat exchangers for automotive applications.
Alcoa also makes products for the packaging, building and construction, commercial transportation and industrial markets. It said last month that it plans to sell its packaging business, which includes Reynolds Wrap foils.
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