DOJ requires Novelis to divest Aleris’ North American auto body sheet operations

The DOJ says the divestiture will preserve competition for aluminum automotive body sheet in North America.

The Department of Justice (DOJ) announced Wednesday, May 12, that it has filed a proposed final judgment with the U.S. District Court for the Northern District of Ohio requiring Novelis Inc., headquartered in Atlanta, to divest Aleris Corp.’s entire aluminum automotive body sheet operations in North America to satisfy the Department’s competitive concerns with Novelis’ acquisition of Aleris.

The proposed final judgment follows the United States’ March 9 arbitration win. Prior to filing its civil antitrust lawsuit to block the merger, the Department’s Antitrust Division reached an agreement with Novelis and Aleris to refer the matter to binding arbitration if Novelis and Aleris were unable to resolve the United States’ competitive concerns with the transaction. Under the arbitration terms, Novelis agreed to divest Aleris’ aluminum automotive body sheet operations in North America if the United States prevailed in arbitration. The arbitrator ruled for the United States, holding that aluminum automotive body sheet constitutes a relevant antitrust product market. The DOJ says it filed a proposed final judgment May 12 that, if approved by the court, would fully resolve the competitive harm alleged in the lawsuit.

“Today’s proposed divestiture preserves competition in the market for aluminum automotive body sheet and protects automakers and American consumers by requiring the full divestiture of Aleris’ North American aluminum automotive body sheet operations,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.

Novelis offers flat-rolled aluminum products in three segments: automotive, beverage can and specialty products. In the fiscal year ending March 31, 2019, the company’s revenue was approximately $12.3 billion. Novelis is a wholly owned subsidiary of Hindalco Industries Ltd., headquartered in Mumbai, India.

Prior to its acquisition by Novelis, Aleris was a Delaware corporation headquartered in Cleveland, offering flat-rolled aluminum products to the automotive, aerospace and building and construction industries, among others. In 2018, the company’s revenue was approximately $3.4 billion.

 

Get curated news on YOUR industry.

Enter your email to receive our newsletters.

Loading...