US-Company Purchases Jamalco for US$1
In a stunning deal days away from completion, US-based aluminium producers Century Aluminum Company will be purchasing the majority stake in the Jamalco alumina refinery for US$1 from the current majority owners, the Noble Group.
In 1959, Jamalco started as a bauxite miner before expanding in 1972 to start making alumina. 45% of the company is currently owned by the Jamaican government through Clarendon Alumina Production Limited, with the Hong Kong-based Noble Group holding 55%.
According to reports from the Jamaica Gleaner, Noble acquired its majority interest in the company from Alcoa World Alumina and Chemicals for US$140 million in 2014 but has been seeking a buyer since 2022 for the refinery that has been operating at a loss. Noble experienced several restructurings following the acquisition in 2014, which led to the division of its organisation into two primary divisions. Jamalco was part of the division that saw annual losses.
Additionally, a 2021 fire that destroyed a portion of the Jamalco factory caused a production halt of nearly a year. Noble’s most recent financial reports revealed a net loss of US$97 million over nine months ending in September 2022, an increase from losses of US$67 million in 2021.
The Century Aluminum Company is an associate of Glencore and operates three smelters in the United States and one in Iceland. Filings reportedly seen by the Financial Gleaner state that Century’s transaction with Noble is expected to close by the end of April.
Jamalco’s US$1 purchase price was not explained, but it has been hypothesised that Noble may have been relieved of any future liabilities for Jamalco as a result of the deal.
A release on Jamalco’s sale stated that the company is expected to honour its existing employment contracts and terms and conditions of employment.
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