Orkla Set To Buy Former Sun Portfolio Co. Indalex

OSLO (Reuters) – Norwegian conglomerate Orkla (ORK.OL) is set to acquire U.S aluminium extrusion company Indalex, strengthening its position in north American markets.

Orkla said on Wednesday it would buy 10 active aluminium plants in Canada and the United States with a total capacity of about 315,000 tonnes per year through its aluminium unit Sapa.

The planned purchase represented an underlying enterprise value of about $95 million, Orkla said.

“The first impression is that this is a reasonable purchase which will strengthen (Orkla’s) position in North America,” analyst Dag Sletmo at ABG Sundal Collier said. “If you also have synergies, this is probably a good acquisition,” Sletmo said.

Orkla shares were down 2.0 percent at 0820 GMT, in line with the main index in Oslo .OSEBX.

The company was set to hold a capital market day on Wednesday with presentations starting at 1100 GMT.

Orkla said the deal “would allow Sapa to improve its geographical presence in North America, including an introduction into the Canadian region”.

Indalex has about 1,400 employees and its 2008 sales were about 200,000 tonnes, representing just above $900 million. (Reporting by Aasa Christine Stoltz and Joachim Dagenborg; Editing by Dan Lalor)

peHUB Note: Indalex had been a portfolio company of Sun Capital Partners, prior to filing for Chapter 11 bankruptcy protection earlier this year.