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Alcoa to Buy Alumax for $3.8 Billion

June 16, 1998|Bloomberg News

Aluminum Co. of America won Justice Department approval to acquire Alumax Inc. after agreeing to sell its caste plate plants, including one in Vernon, to ensure continued competition for the product. Without the divestitures, the $3.8-billion acquisition would give Alcoa a 90% market share in caste plate, which is used in machinery to make frozen-food packaging and aircraft and automotive parts. A consent decree outlining the proposed divestitures was filed in U.S. District Court in Washington to settle a lawsuit challenging the combination. The complaint stated that Alcoa, Alumax and a third company, Alpase of Downey, were the world's only producers of aluminum caste plate. Alumax shares fell 81 cents to close at $45.38; Alcoa's stock dropped $1.25 to close at $63.75. Both trade on the New York Stock Exchange.

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