Australian Metals & Mining Weekly: S32: base metals pureplay & Alcoa: upstream + synergies. BSL preview, GGP

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Australian Metals & Mining Weekly: S32: base metals pureplay & Alcoa: upstream + synergies. BSL preview, GGP

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Australian Metals & Mining Weekly

S32: base metals pureplay & Alcoa:

upstream + synergies. BSL preview, GGP

Industry Overview

S32: US$5bn crystallisation of Ali portfolio 06 July 2026

S32 has inked a deal to sell their Alumina/aluminium assets ex-Mozal to Alcoa. Headline Equity

EV is US$4.85bn excluding US$0.75bn pricing-linked contingent payments. Additional Australia

US$1.2bn of rehab provisions, put this at a 12% premium to our US$5.4bn NAV. The Metals & Mining

deal implies a 4.5x post synergy EV/EBITDA multiple on FY27/28 consensus excluding Kate McCutcheon >>

contingent payments, in line with consensus pure play aluminium multiples on 4.3x. The Research Analyst

divestment enables S32 to focus on their growth projects (Hermosa, Ambler, Sierra Merrill+61 2 9226Lynch5728(Australia)

Gorda 4GL), provides a pathway for a "base metals pure-play" re-rate, simplifies the kate.mccutcheon@bofa.com

"story" and makes growth easier i.e. we model ~9% CuEq growth from FY27-31. S32 Chen Jiang >>

Research Analyst

moves to a 'base metals' pureplay, with copper 30-40% of EBITDA post Hermosa. S32 Merrill Lynch (Australia)

says "manganese not core" and "the (M&A) bar is pretty high". See our report: ~US$5bn chen_jiang@bofa.com

crystallisation of Ali portfolio: simplification and focus Elaine Faddis >>

Merrill Lynch (Australia)

elaine.faddis@bofa.comAlcoa: Acquires South32’s aluminium value chain assets

Alcoa (AA) announced it had entered into a definitive agreement to acquire South32's Paul Wiggers de Vries

aluminum+ operations for $5.45 billion. In our view, the deal strengthens AA's leadership Merrill Lynch (Australia)