BPU Reynolds, Inc.
- Lenox Bankers (“Lenox”) served as exclusive financial advisor to a management team of former Alcoa and Reynolds Metals executives in their acquisition of Alcoa’s Sherwin Alumina Refinery, the 9th largest in the world.
- The Lenox team raised senior debt, subordinated debt and equity capital to facilitate the transaction as well as advised the management team on the acquisition price, terms and structure of the buy-out.
- Lenox was able to negotiate a three-year take-or-pay contract with Alcoa fixing the price of alumina sold to Alcoa. In addition, Lenox assisted with BPU’s hedge on the price of natural gas, a key production cost, at a historical average in a turbulent natural gas pricing environment.
- The transaction was structured in a fashion that was readily acceptable to debt markets and provided attractive return expectations for equity and mezzanine groups. Lenox was also able to maximize the management team’s ownership both at closing and at realization through performance hurdles.
- The entire capital structure was placed with investors and lenders within 45 days to comply with the Department of Justice timeline that governed the timing of the divestiture by Alcoa following its merger with Reynolds Metals.
- Subsequently, Lenox assisted BPU Reynolds in its sale to Glencore International (now Glencore-Xstrata, plc).