AMM - By Kirk Maltais
New York 10/10/2016 - Noranda Aluminum Holding Corp agreed to sell its remaining upstream ventures – which include its Gramercy, La. refinery and St. Ann, Jamaica bauxite mine – and has also reached a global settlement with all of its creditors, the company said Friday.
Noranda has executed a stalking horse agreement with New Day Aluminum LLC, a subsidiary of DaDa Holdings LLC, in which the company will purchase both the refinery and the mine for $21.5 million, according to a document filed in the US Bankruptcy Court in the eastern district of Missouri on Oct. 7.
The bid deadline for the upstream assets is now Oct. 17, with the auction taking place Oct. 18 and a hearing on the sale slated for Oct. 26, according to the document.
Fort Lauderdale, Fl.-based DaDa Holdings is a management company consisting of the former senior management team of Wise Metals Group LLC, which was purchased by Constellium N.V. for $1.4 billion in 2015.
“We believe we can reposition these assets to create a similar value matrix to the one we created at Wise Metals Group,” David D’Addario, chief executive of DaDa, said in a statement Oct. 7.
Noranda has additionally filed a motion to dismiss its Chapter 11 case, which was scheduled to be heard on Oct. 28.
“In connection with the global settlement agreement and dismissal of the Chapter 11 cases, it is expected that the company's secured lenders will appoint an advisor to oversee the distribution of Noranda's remaining assets and the completion of business activities following the conclusion of the court-supervised restructuring process,” Franklin, Tenn.-basead Noranda said in a statement.
Once completed, the divestiture of the refinery and mine, along with the global settlement, will allow for Noranda’s Chapter 11 case to be dismissed by the court and will result in the dissolution of the company.
The Gramercy refinery is the only operating alumina refinery in the U.S., and has a capacity to produce more than 1.2 million tonnes of alumina per year, DaDa said. Meanwhile, the St. Ann mine has the capacity to produce up to 5.2 million tonnes of premium grade bauxite ore annually.
A spokeswoman for DaDa did not immediately respond to AMM’s request for further comment.
Noranda reached an agreement to sell its New Madrid, Mo. smelter to Arg International AG for $13.7 million late last month, while a subsidiary of Gränges AB has been approved to buy its four rolling mills for $324.2 million.
Noranda previously said that its objective when declaring bankruptcy in February was to “stabilize” its upstream business to make it economic viable.
(Editing by Tom Jennemann)