UAE’s EGA to acquire German recycled aluminium firm Leichtmetall

Emirates Global Aluminium (EGA), one of the world’s largest aluminium producers, has agreed to acquire German aluminium recycling firm, Leichtmetall Aluminium.

The deal, which is EGA’s first major acquisition since its formation in 2014, is expected to close during the first half of 2024.

The UAE firm signed a binding sale and purchase agreement to buy 100 per cent of Leichtmetall, according to a statement on Thursday.

“This acquisition provides EGA with a platform to develop a recycling business close to our customers in Europe, contributing to the emerging circular economy and building on our existing position as one of the biggest importers of primary aluminium on that continent,” said Abdulnasser Bin Kalban, CEO of Emirates Global Aluminium.

Leichtmetall is a European specialty foundry that produces hard alloys and larger-diameter billets with high proportions of secondary aluminium.

Aluminium is infinitely recyclable. EGA said recycling aluminium requires 95 per cent less energy than making new metal and results in a fraction of the greenhouse gas emissions of primary aluminium production.

Market analysts expect global demand for recycled aluminium to grow from some 27 million tonnes per year in 2022 to 57 million tonnes in 2040.

EGA champions sustainability

The UAE aluminium producer commenced the construction of the UAE’s largest aluminium recycling plant in Al Taweelah with a production capacity of 170,000 tonnes per year in 2023.

The new facility will supply local and global markets with low-carbon metal under the product name RevivAL.

“The acquisition of Leichtmetall along with the recycling facility we are building in Abu Dhabi, is the first step for EGA in capturing growth opportunities worldwide in low-carbon primary and recycled aluminium,” said Kalban.

Leichtmetall uses renewable energy at its plant in Hannover, Germany, to produce up to 30,000 tonnes of aluminium billets per year with secondary aluminium as some 80 per cent of input material.

The company uses proprietary inductive melting technology, liquid metal treatment and casting processes developed over more than four decades to make, from scrap metal, very high quality and specification products used in demanding applications

Meanwhile, EGA signed a new multi-year agreement to buy smelter-grade alumina from US aluminium producer Alcoa.

The agreement, spanning eight years starting in 2024, includes volume options that enable EGA to procure up to 15.6 million metric tonnes of alumina from Western Australia.

The UAE’s largest industrial company, which is co-owned by Abu Dhabi’s Mubadala Investment Company and Dubai’s ICD, said its annual profit plunged to $937m (Dhs3.4bn) in 2023 from Dhs7.4bn a year earlier while its revenue dropped to Dhs29.5bn from Dhs34.6bn during the period under review.

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