Former Alcoa sites to become data centres?

Alcoa would consider selling its former sites to data centres.

The US-headquartered aluminium producer has around 20 sites it is considering selling, 10 of which it has prioritised for sale.

The sale of these sites could generate between $500 million and $1 billion.

Molly Beerman, Alcoa’s Executive Vice President and Chief Financial Officer, said the majority of its transformation sites – the company’s term for former closed locations - have electrical infrastructure remaining that would be attractive to a data centre build.

She told last week’s Citi 2025 Basic Materials Conference: “Versus the past when we maybe just went after them as asset sales, now we're looking at working with developers of data centres, and we're getting much more interesting and attractive valuations.

“One that we're working on now that will probably come to fruition first is a former smelter site where we do see that we may be able to get an upfront cash payment, possibly even a stream of cash payments, and then another cash payment at the end.”

She added: I think the data centre, there's absolutely a recognition that the need is between now and 2028.

“So, we're working on our ready sites so that we can deliver on that. Data centres can be built fairly expeditiously. So, we're still in good line of sight to get some of these done in the near term.”

The statement comes as Alcoa warns of the threat data centres pose to smelters, due to their power consumption and higher rates.