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Hydro and Vale transaction completed today

Norsk Hydro ASA (Hydro) expects to complete the acquisition of the aluminum division of Vale S.A. today, February 28, 2011. (Vale).

In view of this development, Hydro's Board of Directors has decided to issue approximately 448 million shares to Vale Austria Holdings GmbH, a wholly owned subsidiary of Vale SA, as part of the historic transaction with Hydro, as it did in May Announced in 2010 to take over Vale's bauxite, alumina and aluminum business in Brazil.

The acquisition will enable Hydro to acquire valuable assets in Brazil, including full control and ownership over Paragominas, one of the largest bauxite mines in the world, as well as 91 percent from Alunorte, the world's largest alumina refinery, 51 percent from Albras aluminum plant and 81 percent from the alumina refinery -CAP project. The transaction also includes additional bauxite concessions and an agreement to acquire bauxite worth Vales' 40 percent stake in the bauxite mine MRN.

A historic day

“This is a historic day and the beginning of a new era for Hydro as a fully integrated and truly global company. Through this transaction, Hydro gains the resources and the value needed to continue playing an active role in the promising and rapidly growing aluminum industry, ”said Svein Richard Brandtzæg, Hydro CEO.

“Hydro is now well positioned in three strategically important and resource-rich regions of the world, in Brazil, Northern Europe and Qatar, all of which are of particular strategic importance for the further growth of Hydro. I am particularly pleased to welcome 4200 new highly competent colleagues on board who are well equipped to help keep Hydro on a steady course in the future, ”says Mr. Brandtzæg.

As part of the transaction, Hydro will take over 60 percent of Vale from Paragominas, 57 percent from Alunorte, 51 percent from Albras and 61 percent from the CAP alumina refinery. Even before the takeover, Hydro owned 34 percent of Alunorte shares and 20 percent of CAP.

gain in know-how and expertise

A total of approximately 4,200 Vale employees will transfer to Hydro as a result of the acquisition, which represents a significant gain in know-how, expertise and qualifications in the areas of bauxite, alumina and aluminum. Hydro's Johnny Undeli, New Head of Bauxite & amp; Hydro's Aluminia stores are based in & nbsp; in Rio de Janeiro, Brazil.

The transaction is valued at $ 5.27 billion at the time of final closing. The compensation is made up as follows: 22 percent of Hydros' outstanding share capital, valued at approximately $ 3.53 billion - based on the Hydro share closing price on February 25, 2011 of CZK 44.63 and one US dollar Rate of $ 5.66 - and the cash payment to Vale of about $ 1.08 billion and the transfer of net debt from the acquired business of about $ 0.66 billion towards the end of January 2011.

In addition, Hydro has undertaken to acquire the remaining 40 percent stake in Paragominas in two stages in 2013 and 2015 for a cash payment of $ 200 million each.

The business acquired from Vale will be integrated into Hydro's financial report from March 2011, and the results generated by these units from that month on will be included in the company's first quarter 2011 report. There will be a new reporting segment called Bauxite & amp; Alumina created in which the results of the bauxite and alumina businesses are listed. Results from the Albras aluminum plant will be included in the Primary Metal reporting segment.

Norway and Vale main shareholders

As part of the consideration, Vale will receive 447,834,465 shares, each with a nominal value of CZK 1.098 per share. Upon completion of the takeover, Hydro's new share capital will be 2,271,760,107,048 Norwegian Krone, divided into 2,068,998,276 shares, each of which has a nominal value of 1,098 Norwegian Krone. Hydro holds 33,387,070 of its own shares, and the number of shares outstanding is 2,035,611,206.

The two most important Hydro shareholders will in future be the Norwegian state, represented by the Ministry of Commerce and Industry, with a share of 34.3 percent of the issued and 34.8 percent of the outstanding shares and Vale with a share of 21, 6 percent of the issued or 22.0 percent of the outstanding shares.

Due to the moratorium agreed between Hydro and Vale and a blocking clause, Vale cannot increase its stake in Hydro beyond the 22 percent obtained through the transaction. Vale must retain its equity stake for at least two years after the transaction is completed and cannot sell more than 10 percent of the Hydro shares issued to a single buyer or group of buyers after those two years.

Vale has the right to have a representative on Hydro's Board of Directors under the terms of the agreement. Mr. Tito Martins, Executive Officer and Head of Base Metals at Vale, has been elected to Hydro's Board of Directors and will be its tenth member immediately upon completion of the transaction.

This text is machine translated. To view the original German text, click on DE on the top right of this window

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