Spanish, US metallurgy giants announce merger

Spanish metallurgy giant FerroAtlantica and its US peer Globe Speciality Metals said Monday they had agreed to merge to form a leading producer of silicon metal worth $3.1 billion (2.7 billion euros).
The deal was unanimously approved by the boards of the two companies and the deal is expected to close in the fourth quarter, they said in a statement.
Silicon metal has several industrial uses, including as an alloying agent able to increase the strength of aluminium as well as to make solar panels.
Silicon based polymers can appear in many every day products such as lubricants, greases, resins, skin and hair products.
"Globe's combination with FerroAtlantica creates a premier global player in the fast-growing silicon metal industry and combines two best-in-class companies," Globe's executive chairman Alan Kestenbaum said in the statement.
"This deal gives Globe shareholders a company with greater international reach, a broader production base and opportunities for further cost reductions on an already low-cost platform."
The deal will produce operational synergies of $65 million per year from economies of scale, better procurement of raw materials and reduced freight costs from improved logistics, the companies said.
The companies said the new entity would take advantage of Globe's strong presence in North America and FerroAtlantica's footprint in Europe.
Miami-based Globe operates 11 production facilities and three mining sites in six countries, with nearly 90 percent of its revenues coming from North America.
FerroAtlantica operates 15 production plants and five mining sites in five countries as well as hydroelectric power plants in Spain and France, with a majority of its revenues coming from Europe.
The new company will employ around 4,700 people around the world and will be listed on the Nasdaq exchange.
Grupo Villar Mir, the parent of FerroAtlantica, will own 57 percent of the new company and Globe shareholders the rest.