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Before Monday’s opening bell, aluminium company Alcoa (AA ) announced that it will acquire RTI International Metals (RTI) in a $1.5 billion deal.
Alcoa has agreed to acquire RTI International Metals, a supplier of titanium and specialty metal products in a $1.5 billion deal. The deal will include $330 million of RTI cash on hand and $517 million in convertible notes.
In the deal, RTI shareholders will receive 2.8315 of AA stock for each share held of RTI. The deal has been approved by the Board of Directors of both companies and is expected to close in 3-6 months.
By acquiring RTI, Alcoa will be able to grow its aerospace business considerably. Approximately 80% of RTI’s revenues are obtained in the aerospace-defense in industry.
Shares of AA were mostly flat during premarket trading Monday. The stock is down 8.3% YTD.
Alcoa (AA ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.1 out of 5 stars.