US metals giant takes control of Africa’s largest aluminium plant in $5.6 billion deal as Australian miner exits sector

US aluminium giant Alcoa has agreed to buy South32’s bauxite, alumina and aluminium business in a deal worth up to $5.6 billion, handing the American producer control of Africa’s largest aluminium plant as the Australian miner exits the sector.

• Alcoa will acquire South32’s bauxite, alumina, and aluminium business in a deal worth up to $5.6 billion.
• The transaction gives Alcoa control of Hillside Aluminium, Africa’s largest aluminium smelter located in South Africa.
• Alcoa will pay $3.1 billion in cash, $1 billion in shares, assume $750 million in debt, and potentially up to $750 million more if prices rise.
• South32 is reshaping its portfolio to focus on energy transition commodities, retaining its operations in manganese and exploration in Southern Africa.

Under the agreement, the Pittsburgh-based company will pay $3.1 billion in cash and about $1 billion in shares, while taking on about $750 million in debt and lease liabilities.

The Australian miner could receive a further $750 million if alumina and aluminium prices exceed agreed targets over the next four years.

Once completed, the transaction will give Alcoa ownership of Hillside Aluminium, in South Africa, the continent’s largest aluminium smelter, while lifting its global share of equity-attributable bauxite production from 8.5% to 13% and putting it ahead of Rio Tinto.

DON'T MISS: Nigeria joins Africa’s alumina race with new $1.3B refinery deal

South Africa At The Centre Of The Deal

A major African asset in the transaction is Hillside Aluminium in Richards Bay, KwaZulu-Natal, with the deal also including the idled Bayside smelter property.

The Richards Bay operation is South Africa’s only primary aluminium smelter and Africa’s largest aluminium plant, with annual production guidance of about 720,000 tonnes.

This places Hillside ahead of other major aluminium facilities on the continent, including Mozal Aluminium in Mozambique, Egyptalum’s Nag Hammadi smelter in Egypt and Valco in Ghana.

Mozal, located about 20 kilometres west of Maputo, is Africa’s second-largest aluminium smelter, with capacity of up to 580,000 tonnes a year.

Egyptalum’s Nag Hammadi complex has current capacity of about 320,000 tonnes a year, while its proposed new 300,000-tonne-a-year smelter is not part of its current operating capacity.

South32 Africa chief operating officer Noel Pillay said the agreement recognises Hillside’s long-term value and places it under a specialist aluminium producer.

“As a leading global producer of materials across the aluminium value chain, Alcoa is well positioned to operate Hillside into the future,” Pillay said.

“The smelter will be operated by a dedicated aluminium producer, which will bring the benefits of its deep aluminium value chain experience to the region.”

Pillay added that the Richards Bay operation had made a major contribution to South Africa over the past 30 years.

“It has made a major contribution to South Africa’s economy, employed thousands of local workers, and played a key role in supporting the downstream aluminium industry. We expect this contribution to continue under Alcoa’s ownership,” he said.

DON'T MISS: Africa’s top bauxite hub attracts $1 billion alumina plant from China’s largest state-owned producer

Alcoa Deal Reshapes South32’s Southern African Portfolio

For the Australian miner, the sale marks another step in its portfolio reshaping as it reduces exposure to aluminium and focuses more on commodities linked to the energy transition.

After completion, the group’s remaining Southern African business will include manganese operations in South Africa’s Northern Cape, as well as exploration activities in Botswana and Namibia.

Notably, its Mozal Aluminium smelter in Mozambique is excluded from the transaction and will remain under the seller’s ownership, after being placed on care and maintenance in March 2026 following failed talks over affordable power supply.

After the deal closes, South32 shareholders are expected to own about 6% of the US producer.

For Alcoa, the acquisition is expected to strengthen its aluminium supply chain and lift annual capacity to 3.2 million tonnes of aluminium and 14.8 million tonnes of alumina, as US companies race to secure key industrial materials and rival China’s dominance in global metals supply.