Business Case Studies, Organizational Behavior Case Study, Strategy, Restructuring / Turnaround Strategies

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Restructuring / Turnaround Strategies Case Study

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Case Title:

Novelis, Alcan's Spin-off: Staying Competitive?

Publication Year : 2006

Authors: Shalini, Sumit Kumar Chaudhuri

Industry: Aluminium Production

Region: USA

Case Code: RTS0075

Teaching Note: Not Available

Structured Assignment: Not Available





Abstract:
In January 2005, Alcan, the Canadian aluminium company, spun-off its rolled products business into an independent company, Novelis. The Spin off was required for Alcan to receive an antitrust approval from the European Union after its acquisition of a French company, Pechinery. Novelis supplies rolled products for use in food and beverage, can production, food packaging foils as well as automotive parts. In 2004, with customers like Jaguar, Ford, Mercedes, Reaxam and Kodak Polychrome Graphics, Novelis generated sales of $7.8 billion. However, it is mired with problems like a debt of $2.95 billion, rising energy costs and metal price ceilings in some of its sales contracts.

Pedagogical Objectives:

  • To highlight the rationale behind the Spin off of Novelis from Alcan
  • To discuss the competitive strategies of Novelis in the global rolled products business.

Keywords :  Alcan; Novelis; Spin off; Competitive strategy; Restructuring / Turnaround Strategies Case Study; Flat-rolled aluminium market; Aluminium production; US; GM (General Motors); Mercedes; Jaguar Cars Limited; Metal price ceiling; Canada

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Case Study :
   INR 200 = USD ($)

Structured Assignment:
   INR 150 = USD ($)

Teaching Note :
   INR 400 = USD ($)
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