China’s influence in the global metals markets just stepped up a gear after the owner of its top supplier of aluminum products agreed to buy Aleris Corp of the US for US$2.3 billion, marking the nation’s biggest-ever overseas purchase of a metals processor.
The purchase of the Cleveland, Ohio-based company by Zhongwang USA LLC, owned by Liu Zhongtian (劉忠田), founder and chairman of China Zhongwang Holdings Ltd (中國忠旺控股), will open up new markets for the Chinese company among aerospace and automotive companies.
Monday’s deal underscores China’s shift to higher value-added products and will give Zhongwang access to technological know-how and more demanding customers, said Paul Adkins, managing director of Beijing-based aluminum consultancy AZ China Ltd.
“Aleris supplies the Boeings and the big carmakers of this world — very advanced consumers,” Adkins said by phone. “Buying it has to provide some sort of opportunity for Zhongwang to bring that know-how back to China. When you’ve got more than half of the world’s primary aluminum supply in China, there is a natural momentum for China to pull other parts of the supply chain into its orbit.”
China Zhongwang is Asia’s biggest producer of extruded aluminum and already has ambitions to sell aluminum sheet to China’s emerging auto and aerospace industries. It is due this year to start up a flat-rolled aluminum plant in Tianjin, which will supply products that China still has to import.
The acquisition will leave Zhongwang founder Liu overseeing “companies that have complementary geographic footprints and capabilities,” Zhongwang USA said in a statement.
Aleris has its own mill in China’s Zhenjiang Province, producing aerospace plate, “which Zhongwang lacks the know-how to produce,” according to a note from Bloomberg Intelligence analyst Yi Zhu.
China Zhongwang is being probed by the US Department of Commerce for possible circumvention of US anti-dumping duties. The inquiry was launched in response to a complaint from the US Aluminum Extruders Council. The company has denied any wrongdoing.
The purchase of Aleris is unlikely to face any regulatory hurdles from US authorities, chief executive officer Sean Stack said.
Liu offered China Zhongwang the opportunity to buy Aleris directly, but it declined because of concerns the deal would adversely affect its cash flow and financial planning, the Hong Kong-listed firm said in a statement.
China Zhongwang said it would consider buying Aleris “as and when appropriate” after Liu’s US holding has completed the deal.
Aleris’ clients include Airbus Group, Siemens, Bombardier, Boeing and ABB., Bloomberg Supply Chain data showed.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last