Alcan Makes Play for Pechiney

Alcan Inc. announced plans to launch a tender offer for Pechiney in order to solidify its position as one of the world's largest aluminum and packaging companies. The completion of the transaction is expected to create value for the shareholders of both companies. Alcan and its customers will benefit from a broader product portfolio, technological leadership and enhanced market capability.

"This is a win-win offer that maximizes value for shareholders and stakeholders of both companies, recognizes the strengths of both companies and provides the best option for future growth. I am convinced that Alcan's offer represents an exceptional opportunity for both Pechiney and Alcan and that now is the right time to seize it," said Travis Engen, Alcan's President and CEO.

The combined company will benefit from enhanced scale, financial strength and technological resources as well as its increased capability to serve customers worldwide. Reflecting Alcan's significantly increased industrial presence in France, Alcan intends to locate the global headquarters of the combined entity's packaging business in Paris and has identified France as the headquarters for its European primary aluminum business. In addition, Alcan has identified France as the future home for its global center of excellence for new cell technology development in primary aluminum.

According to Alcan, the offer represents a 28 percent premium over Pechiney’s closing price of July 2.

Alcan's offer to Pechiney was filed with the market authorities July 7^th.

Pechiney has three core businesses: primary aluminum, aluminum conversion and packaging.

In 1999 Alcan attempted to purchase Pechiney, although that move was rejected by European regulators. If the deal is complete the combined company would be the largest aluminum company in the world.