Alcoa, a leading multinational in the aluminum industry, has announced the initiation of the sale process for its San Cibrao complex in Spain, marking a potential end to its aluminum production activities there. The decision was disclosed during a company monitoring committee meeting in Madrid, attended by worker representatives, the Xunta, and the Ministry of Industry. Alcoa has begun scouting for potential buyers, aiming to initiate informal contacts in May and secure binding offers by June, indicating a swift sale process under close public administration scrutiny.
This move diverges from Alcoa's previous strategy concerning facility closures and divestments, notably illustrated by the closure of its Ferndale smelter in Washington in 2020. The Ferndale facility, after ceasing production amid market downturns and high operational costs, was eventually closed in 2023, shifting focus from aluminum to potential new business ventures, including green hydrogen production, in partnership with Canada's AltaGas.
Similarly, Alcoa's approach in Spain mirrors its actions in the United States, where it also permanently dismantled another smelter, Wenatchee Works, transitioning the site for alternative future use. In Spain, Alcoa's A Coruña and Avilés plants, initially earmarked for closure, were sold to Parter fund and subsequently to Grupo Industrial Riesgo, forming Alu Ibérica. However, these plants ceased aluminum operations, moving towards bankruptcy and eventual sale, with the A Coruña site now pivoting to green hydrogen ventures.
The sale process for the San Cibrao complex comes amidst Alcoa's strategic reassessment of its operations, with the company cautioning about the uncertainty of the sale's success. Alcoa emphasizes the need for a long-term viability solution, proposing labor measures and highlighting financial analyses predicting losses for the complex through 2026, with positive cash flow expected only from 2027. The urgency of finding a solution is underscored by impending insolvency risks, as designated funds for its Spanish operations are anticipated to deplete in the second half of this year.
