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<Research>Citi Expects CHALCO (02600.HK) Acquisition to Raise Aluminum Output by 6%, Keeps Stock as Sector Top Pick
Recommend 12 Positive 23 Negative 17 |
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CHALCO (02600.HK) planned to establish a joint venture to acquire 446 million ordinary shares in Companhia Brasileira de Aluminio S.A. held by Votorantim S.A. for a consideration of approx. RMB6.286 billion, Citi Research issued a research report saying. Furthermore, the joint venture will launch a mandatory tender offer for all remaining outstanding shares of Companhia Brasileira de Aluminio S.A. in accordance with regulations, and initiate a delisting offer simultaneously with the mandatory tender offer. However, it may reassess the plan to initiate the delisting offer after the completion of the aforementioned acquisition of control. Meanwhile, the broker expected this potential acquisition to bring an annual aluminum production capacity of 430,000 tons to CHALCO, implying an output growth of about 6%. Therefore, CHALCO remains Citi Research's sector top pick, with a target price of $15.94 and rating at Buy. AASTOCKS Financial News Website: www.aastocks.com |
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