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Hydro Extruded Solutions AS has reached an agreement with Pittsburgh-based metals manufacturer Arconic to acquire its two extrusion plants in Brazil.

The two extrusion plants in Utinga and Tubarão in Southern Brazil have combined more than 600 employees, a cast house, seven presses ranging from 7 to 14 inches and value-added capabilities. Under the terms of the agreement, Arconic will receive approximately $10 million in cash for its Latin American extrusions business, subject to working capital and other adjustments.

"We believe in the integrated business model and Brazil is the country where Hydro's entire value chain is present," says Hydro President and CEO Svein Richard Brandtzæg. “From bauxite and alumina, via primary production to extruded solutions, this will strengthen our ability to serve our customers.”

Hydro says the transaction is in line with its strategy of selected growth within its extruded solutions business area and will strengthen the company’s position in Brazil.

"We believe in the importance of being close to our customers to offer high quality customized extrusions and local support,” says Egil Hogna, executive vice president and head of extruded solutions at Hydro. “With the acquisition of Utinga and Tubarão, Hydro will become the market leader in the Brazilian extrusion market."

Completion of the transaction is subject regulatory and antitrust reviews in Brazil. Both companies said they expect the deal to close in the first half of 2018.