Corus to sell £1bn aluminium unit
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Corus, the struggling Anglo-Dutch steel company, is expected to put its aluminium business up for sale today with a £1bn price tag.
The company has called in the unions for a briefing on the move and its full-year results first thing this morning. Despite aluminium being one of its few profitable operations, Corus has decided that it is not big enough in the activity to justify keeping the business, which has plants in Europe. Credit Suisse First Boston, the investment bank, is to conduct an auction of the division.
Corus is expected to report an operating loss of some £450m for 2001, while forecasts for the pre-tax loss range from £550m to £650m.
The aluminium operations of Corus are dwarfed by larger rivals in terms of product output, producing less than a quarter of the more than 2 million tonnes supplied by the likes of Alcoa and Alcan. Corus made a double-or-quits decision after losing out in the bidding war to buy VAW, the German aluminium operation.
The world's largest aluminium groups, including Pechiney and Alcan, as well as private equity firms are expected to be interested in the Corus aluminium operations.
Ken Penton, of the ISTU steel union, said: "This is worrying. We will want to know from the company what the rationale is and what they will do with the money."
The union thinks that better-performing parts of Corus should help keep other parts of the company afloat when times are tough. However Corus needs cash to reduce debt, which stands at about £1.6bn, and to pay for reorganisation costs and investment.
Analysts will look for Corus' assessment of the likely impact of the controversial decision by the US to slap tariffs of up to 30 per cent on steel imports. The move will hit two Corus plants around Rotherham, south Yorkshire, in particular, which produce most of the company's US exports.
Separately, evidence emerged over the weekend of a split in the US administration after the Treasury Secretary Paul O'Neill told a foreign policy think-tank that he disagreed with the imposition of steel tariffs, according to a report in The New York Times. Mr O'Neill apparently affirmed his long-held personal opposition to trade barriers.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments