Alcoa has agreed to acquire South32’s interests in a portfolio of bauxite, alumina and aluminium assets across Australia, Brazil and South Africa in a $4.1 billion transaction, strengthening its global upstream operations and expanding its production capacity.
Alcoa has entered into a definitive agreement to acquire South32’s interests in a portfolio of bauxite mines, alumina refineries and aluminium smelters in a cash and stock transaction with an upfront value of approximately $4.1 billion.
The transaction represents an implied enterprise value of approximately $4.7 billion, including net debt primarily related to normal course financing leases. Alcoa has also agreed to provide South32 with a contingent value right (CVR) of up to $750 million.
The acquisition will expand its global mine-to-metal platform, strengthen its portfolio of upstream assets and increase its ability to serve customers as demand for critical minerals and metals continues to grow.
The acquisition supports its long-term growth strategy by adding a diversified portfolio of mining, refining and smelting assets while improving supply chain resilience across key regions.
Alcoa expects the transaction to generate approximately $900 million in net present value through operational optimization, greater integration and the application of best practices across the combined portfolio.
William F. Oplinger, President and Chief Executive Officer of Alcoa, said: “This is exactly the type of opportunity Alcoa is built to execute. These high-quality, globally relevant assets are a strong strategic fit within our portfolio and align directly with our strengths as a leading pure-play upstream aluminium company. With our proven operating model and global capabilities, we are well positioned to enhance performance, unlock value, and support their long-term success within Alcoa.”
Oplinger added: “Alcoa is defined by how we operate, combining operational excellence, commercial discipline, and a values-based approach that prioritizes safety, reliability, and partnership. By investing in this opportunity, we are underscoring our commitment to supply security for our customers, strengthening the communities in which we operate, and delivering responsibly produced materials that are essential to the global economy.”
Under the agreement, Alcoa will acquire South32’s interests in the Boddington bauxite mine and Worsley alumina refinery in Western Australia, the Hillside aluminium smelter and idled Bayside smelter property in South Africa, and the Mineração Rio do Norte (MRN) bauxite mine and the Alumar alumina refinery and aluminium smelter in Brazil.
The transaction excludes South32’s Mozal aluminium smelter in Mozambique.
Upon completion, Alcoa said it expects to become a leading global alumina and aluminium producer with pro forma calendar year 2025 production of 3.2 Mmt of aluminium and 14.8 Mmt of alumina.
Alcoa said the acquisition is expected to be immediately accretive to earnings per share and free cash flow following completion.
The company also expects the larger integrated portfolio to improve cost competitiveness, strengthen security of supply and create new growth opportunities, including an expanded presence in Australia and Brazil and a new operating presence in South Africa.
Thomas J. Gorman, Chairman of the Board of Alcoa, said: “The Board is pleased to support this transaction, which we believe strengthens Alcoa’s competitive position, supports long-term earnings and cash flow growth, and creates lasting value for our shareholders. We remain committed to the employees and stakeholders whose contributions are central to the success of these operations.”
Alcoa will pay South32 $3.1 billion in cash and approximately 17.0 million newly issued Alcoa common shares, with an implied value of approximately $1.0 billion.
South32 may also receive up to $750 million through the contingent value right, subject to agreed alumina and aluminium price thresholds over four successive annual periods beginning on July 1st, 2026.
The transaction is expected to close during the first half of 2027, subject to South32 shareholder approval, regulatory approvals and customary closing conditions. The transaction has been unanimously approved by the Board of Directors of both companies.
