“We are looking forward to work with Glencore to further develop Alunorte. Glencore has broad industrial experience within metals and mining, which adds to the significant progress our bauxite and alumina area has made to bring down the footprint of alumina production. This enables Hydro to strengthen our position in low-carbon aluminium,” says President and CEO, Hilde Merete Aasheim.  

Hydro and Glencore will continue efforts to reduce carbon emissions from Alunorte through the fuel switch project that aims to substitute fuel oil with LNG, and the electrification of boilers. This will bring Alunorte to the first decile on the global carbon curve already in 2025, positioning Alunorte as a leading supplier of low-carbon alumina. The partners are committed to continuing the development of social projects to improve the lives and livelihoods of nearby communities.

“This transaction is an important step to deliver on Hydro’s strategy. Alunorte remains a core strategic asset for Hydro and is a key source of low-carbon alumina supply to our primary aluminum smelters,” says Aasheim. 

The total enterprise value for the transaction is USD 1.11 billion, which was adjusted by USD 244 million for 30 percent of Alunorte’s net debt and deviation from normalized working capital as of June 30, 2023. The enterprise value and net debt exclude asset retirement obligations of USD 40 million on a 30 percent basis. The parties have agreed to a post-closing price adjustment based on the financial performance of Alunorte and Hydro expects to pay the full capped amount of USD 55 million in Q1 2024. 

Alunorte will continue to be consolidated in Hydro’s financial accounts. There will be no remeasurement or recognized gain related to this transaction.

Following the sale, Hydro remains the largest shareholder of Alunorte with 62 percent ownership. Glencore owns 30 percent of Alunorte, while the remaining four minority shareholders collectively own 8 percent.