The company closed the transaction, which was announced on June 26, 2014, after receiving all of the required global regulatory approvals and arranging financing for the deal.
Firth Rixson strengthens Alcoa’s aerospace portfolio and positions the company to capture greater profitable growth from its expanding value-add business. The transaction doubles Alcoa’s average revenue content on high-growth engine programmes.
Accelerating Alcoa’s transformation to a multi-material enterprise, the acquisition increases its offerings made of nickel-based superalloys, titanium, stainless steel and advanced aluminium alloys, produced using the most advanced isothermal forging technology and ring production capabilities.
“By combining the talent and cutting-edge technology of our two innovation-driven companies, we are taking our aerospace business to new heights,” said Klaus Kleinfeld, Alcoa Chairman and Chief Executive Officer. “This transaction is creating a more profitable future for Alcoa by delivering greater sustainable value for our customers, employees and shareholders.”
With this acquisition, Alcoa’s revenues are expected to increase by $1.6 billion with an additional $350 million EBITDA in 2016, and to increase by $2 billion in revenues by 2019. Approximately 70% of this growth is secured by long-term agreements.
A majority of these new revenue streams come from aerospace sales, enabling Alcoa to further capitalize on strong growth in the commercial aerospace sector. Alcoa projects a compounded annual commercial jet growth rate of 7% through 2019 and sees a current 9-year production order book at 2013 delivery rates.