Alcoa and Ignis are close to signing a joint funding agreement for Spain's aluminium plant

Alcoa announced on Wednesday that it is "progressing", towards a strategic agreement of cooperation with the Spanish renewable energy company Ignis, to fund the operations of the U.S. Metal Producer's aluminum plant in northwest Spain.

Alcoa announced that the proposed agreement would see Alcoa contribute 75 million Euros ($81 million), and Ignis make an initial 25 million Euro investment, giving Ignis 25% ownership of San Ciprian in Galicia.

Alcoa, based in Pittsburgh, Pennsylvania, said it would provide up to 100 million more euros if needed, prioritizing future cash flows. Alcoa will share any additional funding with Ignis in a 75-25 split.

San Ciprian stakeholders including the Spanish government and regional Galician authorities must approve the potential deal.

Alcoa has been complaining for years about the high energy prices in Spain that have made their plant uncompetitive. This was exacerbated when European electricity prices reached record-highs during the COVID-19 epidemic and the conflict in Ukraine.

Alcoa began looking for a buyer of 100% of San Ciprian earlier this year. The company said no bids were received despite having shared information with 60 investors.

(source: Reuters)