Subject category:
Strategy and General Management
Published by:
IBS Case Development Center
Length: 14 pages
Data source: Published sources
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https://casecent.re/p/66445
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Abstract
In January 2005, Alcan, the Canadian aluminium company, spun-off its rolled products business into an independent company, Novelis. The spin-off was required for Alcan to receive an antitrust approval from the European Union after its acquisition of a French company, Pechinery. Novelis supplies rolled products for use in food and beverage, can production, food packaging foils as well as automotive parts. In 2004, with customers like Jaguar, Ford, Mercedes, Reaxam and Kodak Polychrome Graphics, Novelis generated sales of $7.8 billion. However, it is mired with problems like a debt of $2.95 billion, rising energy costs and metal price ceilings in some of its sales contracts. The case study, while highlighting the rationale behind the spin-off, of Novelis from Alcan, offers scope to discuss the competitive strategies of Novelis in the global rolled products business.
About
Abstract
In January 2005, Alcan, the Canadian aluminium company, spun-off its rolled products business into an independent company, Novelis. The spin-off was required for Alcan to receive an antitrust approval from the European Union after its acquisition of a French company, Pechinery. Novelis supplies rolled products for use in food and beverage, can production, food packaging foils as well as automotive parts. In 2004, with customers like Jaguar, Ford, Mercedes, Reaxam and Kodak Polychrome Graphics, Novelis generated sales of $7.8 billion. However, it is mired with problems like a debt of $2.95 billion, rising energy costs and metal price ceilings in some of its sales contracts. The case study, while highlighting the rationale behind the spin-off, of Novelis from Alcan, offers scope to discuss the competitive strategies of Novelis in the global rolled products business.