The Brief:
South32 sells its entire aluminium portfolio across Australia, Brazil and South Africa to Alcoa in a deal worth up to US$5.6bn.
Mallesons advises South32. Ashurst Perkins Coie acts for Alcoa.
South32 is getting out of aluminium.
The Perth-based miner has agreed to offload its bauxite, alumina and aluminium assets across Australia, Brazil and South Africa to US giant Alcoa Corporation, in a deal with an implied enterprise value of up to US$5.6bn.
It’s a full strategic reset. Strip away aluminium and South32 is left as a pure copper, manganese and zinc business.
The deal
Under the transaction, Alcoa picks up South32’s interests in Worsley Alumina (86%), Hillside Aluminium (100%), the MRN bauxite mine (33%), the Brazil Alumina refinery (36%) and the Brazil Aluminium smelter (40%). That also covers the Boddington bauxite mine in Western Australia and the idled Bayside smelter property in South Africa. South32’s Mozal smelter in Mozambique is carved out and stays under strategic review.
The consideration stacks up as US$3.1bn in cash, US$1.0bn in Alcoa scrip, and up to US$750m in contingent cash tied to future alumina and aluminium prices. Alcoa also assumes US$750m in net debt and lease liabilities.
South32 will distribute at least half the Alcoa shares it receives directly to its own shareholders, with the company free to sell down the remainder over time.
The deal needs shareholder, competition and regulatory sign-off across multiple jurisdictions, and is expected to complete in H1 2027.
Who’s acting
Mallesons advised South32, led by M&A partners Antonella Pacitti and Will Heath, senior associates Toby Newnes and Jessica Zuiderwijk, and lawyer Gabrielle O'Hara, with client relationship support from David Friedlander.
On the other side, Ashurst Perkins Coie advised Alcoa, led by partners Kylie Lane and Eliza Blandford, with support from senior associate Jonathan Bisset on corporate transactions.
Both firms pulled in specialists from across the firm, including tax, competition, projects, environment, IP, employment and FIRB.
What they said
Mallesons’ Antonella Pacitti said:
“This transaction combines scale, asset complexity and international execution. Representing a globally significant aluminium value chain spanning mining, refining and smelting assets across three continents, it marks a major strategic repositioning for South32.”
She added:
“The breadth of assets, stakeholders and jurisdictions involved, together with the legal, regulatory and commercial considerations at play, required careful coordination across multiple workstreams and geographies. Successfully navigating that complexity is what makes mandates like this both challenging and rewarding, and we are thrilled to be supporting our longstanding client, South32 with this transaction.”
On the Ashurst Perkins Coie side, partner Kylie Lane said:
“We are delighted to be advising Alcoa on this landmark transaction which, when completed, will significantly expand its portfolio of world-class bauxite, alumina and aluminum assets across three continents. We are proud to support Alcoa as it strengthens its position as a leading pure-play upstream aluminum company.”
Source: Mallesons, Ashurst Perkins Coie, South32, Alcoa