RIVERDALE, Iowa — Arconic is the company once known as Alcoa. Alcoa Inc. spun off its alumina and bauxite operations in 2016 into a company called Alcoa Corp., while Arconic became the company that produces rolled and plate aluminum, as well as products for the aerospace and industrial sector.
The company is now in the process of being sold to Apollo Global Management Inc. for $5.2 billion dollars.
1. Who is Apollo Global Management?
Apollo Global Management describes itself as a high-growth, global alternative asset manager.
"We seek to provide our clients excess return at every point along the risk-reward spectrum from investment grade to private equity with a focus on three investing strategies: yield, hybrid, and equity. For more than three decades, our investing expertise across our fully integrated platform has served the financial return needs of our clients and provided businesses with innovative capital solutions for growth," Apollo has listed on its website.
As of Dec. 31, 2022, Apollo had nearly $548 billion of assets under management according to the company.
2. When is the sale expected to be complete?
Arconic and Apollo report the transaction should be completed in the second half of 2023.
Before the transaction can be completed, customary closing conditions must be met, including approval by Arconic Shareholders. There must also be regulatory approvals.
3. What about the shareholders?
Under the current agreement, Arconic and Apollo report that Arconic shareholders will receive $30.00 per share in cash, which they say represents a premium of approximately 36% of the company's undisturbed closing stock price on Feb. 27, 2023.
After the sale, Arconic shares will no longer be traded on the New York Stock Exchange.
“Arconic’s talented management team and employees operate a set of premier global assets serving markets that are growing," said Gareth Turner, Partner at Apollo Global Management. "We are committed to investing significant capital in the Company to secure its competitive position and world-class product offering to continue building on Arconic’s journey”.
4. What is Apollo's vision for Arconic's operations?
Apollo is reporting three main strategic investments:
- Upgrades to key machine centers to maximize the full potential of the company's unique production capabilities.
- Upgrade the company's technology and process controls.
- Invest in projects that will provide for a cleaner environment in the communities in which the company serves.
What about the employees?
Arconic's plant in Riverdale employs 2,400 people in the Quad Cities, according to the Quad Cities Chamber list of major employers.
Apollo reports it plans to foster a strong culture of employee engagement, respecting and protecting the collective bargaining process by focusing on strengthening the security of the company's pension plans.
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