Glencore buys stake in Brazil assets from Norsk Hydro for $700m

Miner and commodities trader Glencore said it was buying a 30% stake in Brazilian alumina refinery Alunorte and a 5% stake in bauxite producer Mineracao Rio do Norte from Norwegian aluminium producer Norsk Hydro for around $700m.

Glencore said in a separate statement it expected to pay around $700 million for the equity stakes, which will give it an offtake of the metal of a value proportionate to its equity stake.

Norsk Hydro will use proceeds from the transaction for strategic growth and for shareholder distribution, CEO Hilde Merete Aasheim said.

Glencore head of alumina and aluminium Robin Scheiner said: "The growing decarbonisation trend is driving demand not only for the mass production of batteries that require the raw materials which Glencore produces, but also for primary aluminium as a strong, lightweight manufacturing metal.”

"The acquisition of the equity stakes in Alunorte and MRN provide Glencore with exposure to lower-quartile carbon alumina and bauxite, enhancing our capability to supply such critical material for the ongoing energy transition to our customers.”

“Both Alunorte and MRN produce high quality products, which should support particularly our marketing activities across the Atlantic basin.”

Reporting by Frank Prenesti for Sharecast.com