Russia’s aluminum giant RUSAL makes first US investment since sanctions lifted

Russian aluminum major RUSAL said it is teaming up with US manufacturer Braidy Industries to build a mill in Kentucky. It will invest $200 million and assume a 40 percent ownership stake in the mill in return.

Braidy would hold the other 60 percent share in the plant, which will produce aluminum sheet primarily for the transportation industry, including the automotive, aerospace and marine sectors.

The plant is to be built not far from where Ohio, Kentucky and West Virginia meet on the Ohio River. It will have an annual capacity of 500,000 tons of hot-rolled band and 300,000 tons of finished cold-rolled products.

“The output from the mill will aid toward rebalancing the anticipated deficit of the auto body sheet in the US market,” RUSAL said in a statement.

It noted that the Braidy Atlas project will have the lowest CO2 emissions facility for end-to-end manufacturing in North America. “It will be the world’s largest low-carbon rolled aluminum producer, as well as the first new greenfield aluminum mill in 37 years to be constructed in the United States.”

The $1.7 billion project aims to create 1,500 construction jobs and more than 650 full-time jobs once the plant starts production in early 2021.

The investment comes after the US Treasury Department lifted sanctions against RUSAL and its parent En+ which were introduced last year over alleged links between owner Oleg Deripaska and the Kremlin. After months of talks, Deripaska reduced his stake in the company. He has sued the Treasury Department and wants a federal judge to lift sanctions against him.

Braidy said it would not have been able to form the partnership with RUSAL if the sanctions were still in place.

“The bottom line is that without RUSAL we could not build an environmentally-conscious mill of this scale,” Braidy CEO Craig Bouchard told the Associated Press. “We enter the market with the perfect customer proposition — low cost, high quality and low carbon is the future of aluminum.”

The two companies said they have entered into a letter of intent and expect to sign a binding document in the second quarter of 2019.

For more stories on economy & finance visit RT's business section