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Aluminum merger finalized
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September 16, 1999: 8:15 a.m. ET
Three producers formally approve ties; Pechiney posts lower profit
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LONDON (CNNfn) - The three-way merger to create the world's second-largest aluminum producer was formally sealed Thursday among France's Pechiney, Swiss-based Algroup and Canada's Alcan.
The trio announced a $9.5 billion stock swap in August to combine their operations.
The formal agreement paves the way for a new group, with combined 1996 revenue of $21.6 billion, to be established early next year.
The proposed creation of Alcan-Pechiney-Algroup will be put before shareholders of the three firms in late October, subject to regulatory approval.
The agreement coincided with Pechiney's announcement of a 38 percent drop in first-half net profit to 132 million euros ($138 million),
The result includes a special provision of 167 million euros following the listing of American National Can (CAN) and a 155 million euro tax credit.
Group sales dipped 7.3 percent to 4.84 billion euros, including a 9.3 million euro fall in aluminum revenue as weak global commodity prices hit the unit.
The result was in line with expectations, but Pechiney (PPEC) said an improvement in global demand should allow full-year operating earnings to match those of last year.
Pechiney shares firmed 1.35 percent in Paris.
The three-way merger plan saw U.S.-based Alcoa (AA) respond with the $5.6 billion acquisition of Reynolds Metals (RLM) to retain its position as the world's largest aluminum producer. 
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Pechiney
Alcan
Alcoa
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