UPDATE 1-General Cable to buy Rio Tinto's cable business
* Deal for $185 mln
* Alcan to add $650-$700 mln revenue
May 21 (Reuters) - General Cable Corp said it plans to buy Alcan Cable, the wire and cable business of Rio Tinto Plc , for $185 million in cash.
The company, which makes copper, aluminum and fiber optic wire and cable products, said it expects Alcan to contribute about $650 million to $700 million in annual revenue at current metal prices.
Alcan makes aluminum cable for the utility and building industries. It reported operating margins in the low single digit range for 2011.
"With these synergies, an improving North American market and an accelerating greenfield operation in China, the transaction is expected to create shareholder value in the near term," General Cable said in a statement.
The acquisition will expand General Cable's offering to electrical and industrial contractors, the company said.
General Cable said it expects to use its asset-based revolving credit facility to fund the transaction.
The deal is expected to close in the second half of 2012, subject to regulatory approval.
Shares of General Cable closed at $27.06 on Friday on the New York Stock Exchange.
- Alabama man gets $1,000 in police settlement, his lawyers get $459,000
- Canada PM vows crackdown after capital shocked by fatal attacks |
- Man arrested after jumping White House fence, causing lockdown
- Probe: Athletes took fake classes at University of North Carolina
- U.S.-led air strikes killed 521 fighters, 32 civilians in Syria: monitor