Aurubis, Europe's biggest copper smelter, said on Wednesday it had agreed to buy Belgian-Spanish recycling company Metallo Group for 380 million euros ($424 million) as part of an acquisition-led shift into other metals.
"Due to megatrends such as smart homes, e-mobility, digitalisation and renewable energies, both the quantity and the complexity of secondary raw materials will increase significantly," Aurubis Chief Executive Juergen Schachler said.
With around 530 employees at its main sites in Belgium and Spain, Metallo generated revenues of about 985 million euros in fiscal year 2018Metallo, which is being sold by funds managed by investment firm TowerBrook Capital Partners, specialises in recycling difficult materials with low metal content and has attractive growth potential, Aurubis said.
With around 530 employees at its main sites in Belgium and Spain, Metallo generated revenues of about 985 million euros in fiscal year 2018, the German company added.
Aurubis completed its purchase of the remaining shares in copper wire and rod maker Deutsche Giessdraht last July and Schachler said in February it was still seeking acquisitions.
Schachler, who leaves Aurubis at the end of June, has begun an expansion into other metals alongside copper and Metallo's recycling includes nickel, tin, zinc and lead as well as copper.
Metallo processes about 220,000 tonnes of scrap and recycling materials annually at its plant in Beerse in Belgium and another 95,000 tonnes is processed at its plant in Berango in Spain, Aurubis said in a presentation on a conference call.
The tonnage of new metals produced by Metallo is not being revealed.
"Metallo's processing expertise and specific metallurgical know-how provide an excellent complement to Aurubis' own strengths," Schachler said.
Aurubis said the closing of the deal was subject to clearance by merger control authorities including the European Union, and was expected towards the end of 2019.
The company added it was confident of getting regulatory approval. The EU in February blocked Aurubis' plan to sell its flat rolled products business to a German producer.
BNP Paribas acted as adviser to Aurubis on the Metallo deal.
($1 = 0.8954 euros)
(By Michael Hogan; Editing by Alexander Smith and Mark Potter)