Emirates Global Aluminium (EGA), an industrial company in the United Arab Emirates, announced its intention to acquire a majority stake in American aluminum recycling firm Spectro Alloys. The acquisition, which is subject to obtaining regulatory approvals, will accelerate EGA’s global expansion into aluminum recycling and expand EGA’s business in the U.S.
Spectro Alloys is a recycled aluminum alloy producer, founded in 1973, and based in Rosemount, Minnesota. The company has an annual production capacity of 240 million pounds per year of aluminum foundry alloys. Aluminum recycling at Spectro generates more than 95 percent in CO2 and energy savings compared to creating new aluminum.
Earlier this year, Spectro broke ground on a $71 million recycling expansion project that will result in nearly 120 million pounds per year of additional recycling capacity and create up to 50 new full-time jobs. The first phase of this project will be completed in 2025.
EGA intends to acquire 80 percent of Spectro Alloys. The current owner-managers will retain a 20 percent shareholding. EGA and Spectro have signed an equity purchase agreement and the transaction is expected to close during the third quarter of 2024.
“Our goal is to grow further in both primary and recycled aluminum to meet the growing global demand for a metal which is essential for our world’s sustainable future,” said Abdulnasser Bin Kalban, chief executive officer of EGA. “In the United States, which is already one of EGA’s largest global markets, this acquisition will significantly grow our business and expand our offering to customers with our domestic production. Spectro Alloys has a strong and highly experienced team which is already implementing ambitious expansion plans and will be a strong platform for the further development of an EGA recycling business in the United States. I look forward to working with Spectro Alloys’ team.”
“We have grown Spectro Alloys over the last five decades into one of the United States’ top aluminum recycling companies,” said Luke Palen, president of Spectro Alloys. “By becoming part of EGA, we will unlock the next stage of our development in the fast-growing aluminum recycling industry. In the near term, this will allow us to accelerate our ongoing expansion project. In the long term, this is a big win for the future of aluminum recycling in the United States.”
Spectro Alloys currently supplies more than 125 customers, primarily in the Upper Midwest and Texas. Almost half of Spectro’s production is used in the automotive sector. The company sells to semi-fabricators, who in turn supply blue-chip end-user companies. Other important sectors for Spectro include small engine manufacturing, construction, and recreational vehicles.
Spectro sources aluminum scrap from more than 250 scrap suppliers in the region and uses advanced sorting and analysis technology to produce the wide variety of alloys required by the company’s customers. Market analysts expect global demand for recycled aluminum to double by 2040.
