What does the eventual acquisition of Imerys Vox mean for Mytilineos?

Written by Harris Velodopoulos

As announced yesterday by Mytilineos, the company is in discussions with Imerys Bauxites to acquire the company, which is currently one of Greece’s main suppliers of aluminum in bauxite. Specifically, Imerys Bauxites sells 60% of its production to Mytilineos, while Imerys covers the remaining 40%. The potential acquisition of Imerys Bauxites serves the goal of increasing aluminum and alumina production while also paving the way for the production of sufficient quantities of gallium, a strategic mineral used to produce microchips. The EU imports 71% of its gallium and 45% of its germanium from China, while there are only a few companies outside China capable of producing the high-purity metals used in wafers, photovoltaic solar cells and optical fibres.

Recently, the European Commission asked Mytileneos whether it is capable of producing gallium, to meet Europe’s needs, with the aim of making the continent independent of Chinese imports. To appreciate the importance of movement, it is worth noting that gallium is essential in many applications, and is present in smartphones, solar cells, all modern cars, as well as computer chips.

Today, Mytilineos produces 900,000 tons of alumina and 185,000 tons of primary aluminum annually. The demand for gallium is about 40 tons per year, while according to experts, Mytileneus can extract about 60 tons of gallium, a sufficient amount to meet European needs since Greek bauxite is particularly rich in gallium and rare earths such as scandium, lanthanum and others. It should be noted that gallium is produced during the process of converting bauxite to alumina.

According to a Morgan Stanley report, although the relevant acquisition is expected to be confirmed, as well as its financial terms, it confirms the strategic advantages of such a deal that could significantly boost Mytilineos vertical, which will cover nearly 30% of its bauxite needs by 67 percent. % of its production, which is about 700 thousand tons, out of a total of 860 thousand tons, needs bauxite for the alumina plant. At the same time, the move is supported by the EU’s Vital Raw Materials Act which underscores the strategic importance of bauxite, alumina and aluminum for Europe. At the same time, this move may boost prospects for expanding alumina production, which has been one of Mytilineos’ strategic choices in recent years. The potential increase in bauxite sufficiency at Mytilineos could allow an expansion of production by about 1,250,000 tons. Finally, such a move according to Morgan Stanley could boost the outlook for gallium production.