BEIJING, China--Alcoa (NYSE:AA) and the China Power Investment Corporation (CPI) have signed a Letter of Intent that marks an important step in the evolution of the two companies’ partnership, Alcoa announced today.
The letter provides a framework for a completed joint venture, which will focus on producing high-end fabricated aluminum products in China and leverage Alcoa and CPI’s existing capabilities. The new joint venture’s world-class facilities will be well positioned to capture growth in the Chinese automotive, aerospace, packaging and consumer electronics markets.
The two companies signed a Memorandum of Understanding for cooperation on projects in China and around the world during Chinese President Hu’s state visit to Washington, DC, earlier this year.
“This new agreement points to the real progress both companies have made since signing the memorandum of understanding, and I look forward to formalizing the joint venture,” said Alcoa Chairman and CEO Klaus Kleinfeld. “Our joint venture will help shape the future of China’s fast-growing aluminum industry.”
CPI President Lu Qizhou added, “I am excited to see our partnership taking a further step. Deeper cooperation in high-end aluminum fabrication will definitely broaden the space for both companies' development and accelerate our common endeavor to move forward.”
Further terms of the joint venture were not disclosed.
Alcoa is the world’s leading producer of primary and fabricated aluminum, as well as the world’s largest miner of bauxite and refiner of alumina. In addition to inventing the modern-day aluminum industry, Alcoa innovation has been behind major milestones in the aerospace, automotive, packaging, building and construction, commercial transportation, consumer electronics and industrial markets over the past 120 years. Among the solutions Alcoa markets are flat-rolled products, hard alloy extrusions, and forgings, as well as Alcoa® wheels, fastening systems, precision and investment castings, and building systems in addition to its expertise in other light metals such as titanium and nickel-based super alloys. Sustainability is an integral part of Alcoa’s operating practices and the product design and engineering it provides to customers. Alcoa has been a member of the Dow Jones Sustainability Index for nine consecutive years and approximately 75 percent of all of the aluminum ever produced since 1888 is still in active use today. Alcoa employs approximately 59,000 people in 31 countries across the world. More information can be found at www.alcoa.com.
China Power Investment Corporation (CPI) is one of the five Gencos in China and a comprehensive energy group integrating industries of power, coal, aluminum, railway and port. It is the only enterprise in China possessing assets in hydropower, thermal power, nuclear power and new energies at the same time, and is one of the three companies in China that are authorized to develop, build and operate nuclear power plants. By the end of 2010, CPI had installed capacity of 70.72GW, of which 17.74GW was hydropower, which ranked first among the five Gencos. Clean energy accounted for 30% of the total portfolio, the highest among the five Gencos. Meanwhile, CPI had coal production capacity of 72.75 million tons and aluminum production capacity of 2.08 million tons.