Emirates Global Aluminum has announced its intention to acquire a majority stake in U.S. aluminum recycling company Spectro Alloys Corporation.
The acquisition, which is subject to obtaining regulatory approvals, will accelerate EGA’s global expansion into aluminum recycling and expand EGA’s U.S. business.
Spectro Alloys is a leading producer of secondary alloys in the United States, founded in 1973 and headquartered in Rosemount, Minnesota. The company has a production capacity of about 110 thousand tons per year of aluminum ingots, with a carbon intensity of less than one ton of CO2 equivalent per ton of aluminum produced.
Earlier this year, Spectro Alloys began an expansion project at its Rosemount site, which will add approximately 55 thousand tons per year of secondary ingot production capacity in the first phase, which is expected to be completed in 2025.
EGA intends to acquire 80 percent of Spectro Alloys. The current owners and directors will retain a 20 percent interest. EGA and Spectro Alloys have signed a stock purchase agreement and the transaction is expected to close during the third quarter of 2024.
In May, EGA acquired the European specialty smelter Leichtmetall, and late last year, EGA began construction of the largest aluminum recycling plant in the UAE.
Abdulnasser Bin Kalban, CEO of Emirates Global Aluminum, said, “EGA is the world’s largest producer of ‘premium aluminum’ and we aim to grow further in primary and recycled aluminum to meet the growing global demand for a metal essential to our world’s sustainable future. In the United States, already one of EGA’s largest global markets, this acquisition will significantly grow our business and expand our offering to customers with domestic production. Spectro Alloys has a strong and highly experienced team that is already implementing ambitious expansion plans, and will be a solid platform for the future development of EGA’s U.S. recycling business. I look forward to working with the Spectro Alloys team.”
Luke Palen, president of Spectro Alloys, said, “We have grown Spectro Alloys over the past five decades into one of the leading aluminum recyclers in the United States. By becoming part of EGA, the world’s largest producer of ‘premium aluminum,’ we will unlock the next stage of our development in the rapidly growing aluminum recycling industry. In the short term, this will allow us to accelerate our ongoing expansion project. In the long term, this is a big win for the future of aluminum recycling in the United States.”
Currently, the United States consumes about 4.9 million tons of recycled aluminum annually, accounting for half of all aluminum demand in the country and making the United States the second-largest market for recycled aluminum in the world. U.S. demand for recycled aluminum is expected to reach approximately 7.6 million tons per year by 2033, according to CRU, an independent business intelligence organization.
EGA sold approximately 550 thousand tons of primary aluminum in the United States in 2023.
