Aditya Birla firm Novelis files for US listing

Novelis is a leading player in the production of innovative aluminium products and solutions

• Pramod Thomas
• 28 May, 2024

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By: Pramod Thomas

US-based Novelis Inc, which is part of Hindalco Industries, will launch an initial public offer (IPO) to raise up to $945 million (£740m), with an estimated equity valuation of up to $12.6 billion (£9.9bn).

In the proposed public issue, around 45 million shares will be sold by Novelis Inc’s sole shareholders A V Minerals (Netherlands) NV, which is a wholly-owned subsidiary of Hindalco Industries Ltd.

The company will not receive any proceeds.

Novelis, a leading player in the production of innovative aluminium products and solutions and the world’s largest, announced the launch of its roadshow for the IPO of 45,000,000 (45 million) common shares held by its sole shareholder.

“The IPO’s price per common share is currently estimated to be between $18 and $21 per share. Novelis has applied to list its common shares on the New York Stock Exchange under the symbol ‘NVL’,” the company said in a statement on Tuesday (28).

Recently, Novelis filed papers with the US securities regulator, the Securities and Exchange Commission, for its proposed IPO. At present, Hindalco owns 100 per cent of Novelis through A V Minerals. Post-IPO, Hindalco will own around 92 per cent stake in Novelis.

“Novelis expects the selling shareholder to grant the underwriters an option to purchase up to an additional 6,750,000 common shares to cover over-allotments, if any, for 30 days after the date of the final prospectus,” the statement said.

According to sources, the sole shareholder of Novelis would receive proceeds estimated in the range of $810-945m (£634-740m). If the greenshoe option is exercised, sources said the proceeds are estimated at $931.5m (£729.3m) to $1.08bn (£850m).

The equity valuation of the company is estimated to be in the range of $10.8bn (£8.5bn) to $12.6bn (£9.9bn), sources said, adding that the valuation of the enterprise could be in the range of $15.2bn (£11.9bn) to $17bn (£13.3bn).

Earlier this month, Novelis had said that it expects to complete the public offering after the SEC completes its review process, subject to market and other conditions.

“There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering,” it had said.

Novelis is a subsidiary of Hindalco Industries Ltd, an industry leader in aluminium, copper and metals, and a flagship company of the Aditya Birla Group.

This will be the second company from the Aditya Birla group to go for listing overseas after Birla Carbon (Thailand). Novelis, which operates an integrated network of technically advanced rolling and recycling facilities across North America, South America, Europe and Asia, posted a turnover of $16.2bn (£12.7bn) in FY24.

(PTI)