Apollo’s Showa buys Mitsubishi aluminum assets

New York-based Apollo Global Management Inc. has announced its Japan-based portfolio company Showa Aluminum Can Corp. has agreed to acquire the aluminum rolled and extruded products operations of Mitsubishi Aluminum Co. Ltd., a wholly owned subsidiary of Mitsubishi Materials Corp., which also is based in Japan.

The acquisition includes all shares of Universal Can Corp., which Apollo describes as being engaged in the manufacturing of aluminum beverage cans. That operating unit was co-owned by Mitsubishi Materials and Hokkan Holdings Ltd., a Japan-based packaging producer.

“This transaction will bring together two highly complementary businesses, each with a proud heritage of providing high-quality aluminum products to a variety of end-markets and customers,” says Tetsuji Okamoto, partner and head of Japan private equity at Apollo. “We are also pleased to have worked with Mitsubishi Materials to structure a carve-out that meets their business portfolio transformation needs.”

Showa Aluminum describes itself as a leading aluminum beverage packaging provider that together with its group companies, Hanacans Joint Stock Co. and Sakai Aluminum Corp., operates eight manufacturing facilities in Japan, Vietnam and China.

In a June 2020 news release, Showa Denko (as it was then known) says in its 2019 fiscal year it collected approximately 4.43 million used beverage cans (UBCs), which it called “equivalent to about 67.8 tons of aluminum when converted at the rate of 15.3 grams of aluminum per can.”

Apollo says its latest transaction presents a “transformational opportunity for Showa Aluminum to become an integrated, value-added aluminum engineering and packaging group.” The transaction also is “representative of Apollo’s increasing private equity activity in Japan, and is the third major corporate carveout transaction for Apollo Funds completed or announced this year,” states the equity fund.

Last month, Apollo purchased a majority stake in an Italian coated recycled cartonboard mill, buying the stake from Canada-based paper and board producer Cascades Inc.

In January, Apollo purchased the former Showa Denko assets in Japan, setting itself up for its latest transaction.

The purchase of the Mitsubishi assets is subject to closing conditions and regulatory approvals, says Apollo, with the transaction expected to be complete by the end of March 2022.

According to Apollo, BofA Securities Japan Co. Ltd. acted as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP along with Anderson Mori & Tomotsune acted as legal advisors to Showa Aluminum and the Apollo Funds.