Aleris acquisition makes Hindalco largest aluminium company in world
At $2.6 billion, 7.2 times EBITDA, there are fears that maybe, you have paid too much for Aleris. How do you look at the valuation?
Those fears are completely unfounded. The way to look at valuation is to see other comparable transactions in the same sector. I would say that 7.2 times is, if not very reasonable, on the lower side in the sector especially given the quality of the asset.
Aleris is in the same space as Novelis which is aluminium controlled products. Novelis is the world leader globally — the largest in every market that it is in. Aleris is a very high quality, large player, with revenue of about $3 billion. It has 13 very hi-tech manufacturing sites across Europe, the US and China. It gives Novelis a stronger franchise in the auto market and therefore solidifies its position in the auto market.