Sept 30 Swiss-based ARG International AG, the
trading house set up by Glencore Plc's former No. 2
aluminum trader Matt Lucke, is buying a bankrupt smelter in the
United States, its first acquisition since its founding nearly
three years ago.
Noranda Aluminum Holding Corp said on Friday it
sold its 263,000 tonne-per-year New Madrid primary aluminum
smelter in Missouri to ARG for $13.7 million in a court-approved
auction. Noranda filed for bankruptcy in February after
struggling with a sharp downturn in aluminum prices amid
a global glut.
Lucke founded ARG six months after leaving Glencore in the
summer of 2013 alongside chief Gary Fegel, in a shakeup of the
world's biggest aluminum trading desk. Many of Glencore's
executives became paper millionaires after the firm's stock
market listing in 2011.
At Glencore, Lucke helped run Century Aluminum,
which was founded by Glencore and now counts the Swiss trade
house and miner as its largest shareholder. Century is a rival
of Noranda and operates three smelters in the United States and
one in Iceland.
There are few examples in the metals industry of traders not
backed by large companies buying production facilities, but it
has happened with oil. Neal Shear, who helped build Morgan
Stanley's commodity trading business during 25 years at
the bank, purchased the aging Come by Chance refinery in
Newfoundland alongside veteran trader Kaushik Amin.
Lucke's purchase represents a bet on one of the few
remaining U.S. smelters as producers struggle with low metal
prices, high electricity costs and stiff competition from
lower-cost producing regions like the Middle East and China.
The closure of many smelters means the United States, one of
the world's biggest consumers of the metal, has to import more,
helping to underpin premiums, which have remained fairly firm
over the past year.
(Reporting By Luc Cohen; Editing by Cynthia Osterman)