EGA from UAE successfully acquires Leichtmetall as part of European expansion strategy

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Emirates Global Aluminium Expands Presence in Europe with Acquisition of Leichtmetall Aluminium

Emirates Global Aluminium (EGA), the UAE’s largest industrial company outside the oil and gas sector, has completed the acquisition of Germany’s Leichtmetall Aluminium in a strategic move to expand its presence in Europe’s aluminium recycling market.

The acquisition, which was finalized from Leichtmetall Holding, a subsidiary of an investment fund managed by Quantum Capital Partners, marks EGA’s first major transaction since its formation a decade ago through the merger of Dubai Aluminium and Emirates Aluminium.

No financial details of the acquisition were disclosed, but EGA stated that the transaction has cleared all required regulatory approvals and closing conditions.

Abdulnasser bin Kalban, chief executive of EGA, expressed the significance of this acquisition, stating, “For EGA, today is an important early milestone in our drive to build an aluminium recycling business in Europe, where we are already a major primary aluminium supplier, and around the world.”

EGA’s new German operation is a speciality foundry that uses renewable energy to produce up to 30,000 tonnes per year of billets, with secondary aluminium comprising about 80 per cent of the input material. The UAE-based company exports more than 600,000 tonnes of primary aluminium to Europe each year and is a significant supplier for industries including automotive and construction.

Thomas Witte, chief executive of Leichtmetall, expressed excitement about the acquisition, stating, “This is an exciting moment for Leichtmetall, as we join forces with one of the biggest and most ambitious aluminium producers in the world and a major aluminium supplier in Europe.”

The UAE is the fifth biggest producer of aluminium in the world, with Bahrain in sixth position, according to the London-based commodities research firm CRU Group. The GCC region is an important producer of primary aluminium, with the Emirates accounting for 44 per cent of the total GCC production.

Aluminium producers from the GCC are expected to boost exports to the US and European markets following the US and UK bans on trading Russian aluminium, copper, and nickel. The US Treasury Department, in co-ordination with the UK, introduced prohibitions to curtail Russia’s revenue from these exports amid its invasion of Ukraine.

As part of the measures, the US banned the import of Russian aluminium, copper, and nickel produced on or after April 13. This presents an opportunity for aluminium producers from the GCC, including EGA, to expand their market share in the US and Europe.

Overall, EGA’s acquisition of Leichtmetall Aluminium signifies a strategic move to strengthen its position in the European aluminium recycling market and capitalize on emerging opportunities in the global aluminium industry. With a focus on sustainability and innovation, EGA is poised for continued growth and success in the years to come.