Rio Tinto has agreed to transfer customers from its aluminium metal matrix composites (MMC) business to Canada's Cymat Technologies.
Cymat and Rio Tinto Alcan, the miner's aluminium division, signed a commercial deal, according to which Rio will hand over its commercial customer base to the Canadian firm.
The deal is for Cymat to pay Rio Tinto $750 per metric ton of MMC sold or used over five years, capped at $500,000.
From a financial perspective, historical sales volumes provided by Rio Tinto suggest that Cymat could realise incremental annual revenue in the range of $7.5M - $10M.
The deal had originally been suggested in June last year.
Rio Tinto has produced and sold the proprietary ceramic-infused aluminium material, which is used primarily in automotive and rail applications, for more than 40 years, Cymat said.
Rio Tinto's MMC customers include European brake disk manufacturers supplying commercial vehicle and rail markets, Cymat added.
Cymat intends to establish MMC production capability within its existing Mississauga, Ontario plant.
It said: "Given the similarities and common skill sets required to produce MMC with our own SAF product, Cymat will have the ability to utilise its existing expertise and engineering know-how to efficiently and economically manufacture MMC."
It anticipates the production line to be operational by early next year.
