Rio Tinto, Giampaolo Group enter Matalco aluminum recycling joint venture

Rio Tinto and Giampaolo Group have entered into an agreement to form a joint venture to manufacture and market recycled aluminium products. Under the terms of the agreement, Rio Tinto will acquire a 50% equity stake in Giampaolo Group’s wholly-owned Matalco business for $700M subject to usual closing adjustments. Matalco is a producer of high-quality recycled aluminium billet and slab products. It operates six facilities in the United States and one in Canada, with the capacity to produce approximately 900,000 tonnes of recycled aluminium per annum. Giampaolo Group subsidiary Triple M Metal will be responsible for the supply of recyclable feed to the joint venture with Matalco’s leadership team continuing to manage its operations. Rio Tinto will be responsible for sales and marketing of Matalco products following a transition period after completion of the transaction. The joint venture partners will provide oversight to the Matalco management team on matters such as strategic decisions, including executive appointments, safety and ESG standards through a board with equal representation. The joint venture will enable Rio Tinto to provide a broader range of high-quality and low-carbon, primary, recycled, and blended aluminium products, at a time when customers are looking for solutions to lower their carbon footprint. The joint venture will also enhance Matalco’s current service offering to a wider array of customers, while securing access for low-carbon primary metal for its operations. Recycled aluminium is forecast to account for more than half of United States demand by 2028. The transaction is subject to customary regulatory approvals and is expected to be completed in the first half of 2024.