Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Sanjeev Gupta-led GFG Alliance agreed to buy Aleris’ Duffel plant from Novelis. The 240,000mt capacity plant caters chiefly to the European automotive industry. 


The UK-based GFG Alliance has agreed to buy Aleris’ aluminium plant in Duffel, Belgium from Novelis, which a US-based subsidiary of India’s Hindalco. The agreement is part of the Hindalco’s deal to purchase Aleris Corporation for $2.6bn last year. In October 2019, the European Commission asked Novelis to find a different buyer for Aleris’s Duffel plant in an attempt to reduce market concentration. The commission feared that the merged entity would create monopoly and reduce competition in the automotive body sheets market. GFG Alliance, Novelis’ chosen counter-party now awaits approval from Brussels and China’s State Administration for Market Regulation to purchase the Duffel plant and expects the transaction to close before Jan 21, 2020. 


The deal is consistent with GFG Alliance’s strategy to create an international, vertically integrated aluminium business championing low carbon solutions. Purchase of the Duffel plant follows multiple acquisitions made by GFG Alliance in steel and aluminium across Europe. GFG made two additions to its aluminium smelting capacity after it acquired Aluminium Dunkerque, Europe’s largest aluminium smelter with annual capacity of 285,000mt, from Rio Tinto in 2018; and Lochaber smelter in Scotland in 2016. It also bought AR Industries, an aluminium wheels producer located in France.


Duffel is one of the largest rolling mills in Europe and has a production capacity of 240,000mt semi-finished aluminium products annually for European automotive companies. Duffel’s addition to GFG value chain will unlock significant synergies for their production sites at Dunkerque and Lochaber, specifically regarding R&D and freight as the two smelters providing liquid metal are located close to the Duffel plant, according to GFG.

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