Arconic Mulls Competing Buyout Bids From Apollo and Blackstone-Carlyle

According to people familiar with the matter, a deal could be announced as early as next week.

Alternative asset manager Apollo Global Management is said to be in advanced talks to buy US lightweight metals engineering and manufacturing company Arconic for over $11 billion, sources told Reuters.


The potential transaction will be the largest leveraged buyout of 2018.

According to people familiar with the matter, a deal could be announced as early as next week.


Arconic has also attracted the interest of a consortium comprised of private equity firms Blackstone, Carlyle Group, Onex and the Canadian Pension Plan Investment Board. However, the consortium signaled that it may need up to three more weeks to complete its due diligence process.


Apollo tabled a $23 per share takeover offer, although the price could change because the discussions are ongoing, sources said.


Arconic’s stock was up 7% to $21.08 per share on Tuesday when the news broke. The aluminum producer had a net debt of $4.8 billion at the end of September.

The company is a spinoff of the world’s largest producer of aluminum Alcoa.


Arconic said in February it has started a “strategy and portfolio review” and earlier this week announced that it is “extending the scope and duration of this activity to address additional scenarios.” The review is expected to complete in the fourth quarter of the year.


This week, Arconic reported a higher than expected profit on Tuesday for the quarter and raised full-year earnings forecast.


Activist behemoth Elliott Management has been a crucial part of pushing Arconic to initiate a sale process, according to those close to the situation.


In 2017, Elliott won board seats at Arconic after the company surrendered and settled the lengthy proxy contest with the investor.



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