Hindalco Contemplates $1.2 Bn IPO For Novelis
The potential IPO, subject to approval from the US Securities and Exchange Commission (SEC), might see Novelis listed on the New York Stock Exchange by September
Kumar Mangalam Birla’s Hindalco Industries is reportedly considering initiating an initial public offering (IPO) for Novelis Inc., its US-based aluminium products subsidiary, aiming to raise approximately USD 1.2 billion. Sources familiar with the matter disclosed that this move could mark one of the year’s most significant share sales.
According to reports, Hindalco is eyeing a valuation of around USD 18 billion for Novelis, headquartered in Atlanta. The potential IPO, subject to approval from the US Securities and Exchange Commission (SEC), might see Novelis listed on the New York Stock Exchange by September.
Novelis holds the distinction of being the world’s largest producer of flat-rolled aluminium products, extensively utilised in various sectors, including automotive and beverage packaging.
Earlier in February, Novelis had confidentially filed for its IPO with the SEC, setting the stage for its public market debut.
While discussions are ongoing, the specifics of the fundraising endeavor, including its size, remain subject to potential alterations. Furthermore, the aluminium products giant retains the option to opt out of the IPO altogether.
Hindalco’s acquisition of Novelis in a multibillion-dollar transaction in 2007 has since proven to be a substantial asset. Last fiscal year, the US subsidiary contributed to over 60 per cent of Hindalco’s total revenue.
In the proposed IPO, shares will be offered by a Hindalco subsidiary, with Novelis not expected to receive any proceeds from the sale, as per insider reports.
Bank of America Corp. and Citigroup Inc. are reported to be among the financial institutions involved in facilitating the Novelis listing, as previously disclosed by Bloomberg News.
