MADRID - Alcoa (NYSE:AA) Inespal SL, a subsidiary of Alcoa Corporation (NYSE: AA, ASX: AAI), a $10.1 billion market cap aluminum producer currently rated ’FAIR’ by InvestingPro’s comprehensive health scoring system, and IGNIS Equity Holdings, SL (IGNIS EQT (ST:EQTAB)), together with the Spanish National Government and the Xunta de Galicia, have entered into a Memorandum of Understanding (MoU) aimed at enhancing the long-term viability of the San Ciprián operations.
The collaboration, announced Monday, represents a concerted effort to address the economic challenges faced by the San Ciprián smelter, particularly the high energy costs that have historically burdened the facility. With annual revenue of $11 billion and EBITDA of $1.07 billion in the last twelve months, Alcoa has struggled to find a buyer for the operations, and the partnership with IGNIS EQT offers a potential path forward.
Alcoa’s Global Vice President Energy, Álvaro Dorado Baselga, expressed optimism about the agreement, stating, "We expect to use the momentum created today to progress dialogue with our remaining stakeholders, particularly the national Trade Unions, and the local Workers Council, and reach the final elements necessary for San Ciprián’s future."
The MoU outlines several cooperative initiatives, including a short-term focus on dialogues with worker representatives to stabilize operations, prioritizing the smelter’s restart over deferrable capital investments. It also includes streamlining the authorization of renewable energy projects to secure competitive energy costs and providing higher CO2 compensation support. Additionally, the agreement seeks support for the approval of capital projects related to the residue storage area (RSA).
The cooperation between Alcoa and IGNIS EQT continues as they work towards finalizing the conditions necessary to establish their joint venture, aligning with the unions to support the operations.
Alcoa Corporation, a global leader in bauxite, alumina, and aluminum products, aims to reinvent the aluminum industry for a sustainable future. The company’s stock has shown strong momentum with a 24.7% gain over the past six months, and appears slightly undervalued according to InvestingPro’s Fair Value analysis. With earnings scheduled for January 22, 2025, investors following the company’s transformation can access deeper insights and exclusive financial metrics through InvestingPro’s comprehensive analysis tools. The company has been pivotal in making aluminum an affordable element of modern life and continues to drive innovation and best practices in efficiency, safety, sustainability, and community engagement.
The information in this article is based on a press release statement. Alcoa has indicated that future announcements regarding company developments and financial performance will be made through their website, press releases, SEC filings, conference calls, and other media broadcasts.
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