Emirates Global Aluminium (EGA) has completed its acquisition of an 80% stake in Eco Green, an Italian aluminum recycler, adding a significant European scrap collection network to its growing recycling operations. The deal, which received all regulatory approvals and satisfied closing conditions on September 10, brings more than just two Italian plants; it provides access to a commercial network that distributes over 70,000 tonnes of aluminum scrap annually through more than 350 suppliers and 60 customers.
While Eco Green currently casts only a little over 20,000 tonnes of secondary aluminum sows per year, the true value lies in its extensive scrap supply chain. This network is the scarce asset, as it positions EGA to secure feedstock for its expanding recycling capacity. The Scappini family, founders of Eco Green in 1993, will retain a minority stake and remain in management, ensuring continuity in operations.
EGA did not disclose the purchase price or Eco Green's financial details, but the strategic rationale is clear. The acquisition bolsters EGA's European footprint, complementing its existing recycling facilities in the UAE, the US, Germany, and Italy. With this deal, EGA's total recycling capacity now exceeds 400,000 tonnes annually, with an additional 200,000 tonnes under development.
The company's expansion pipeline includes a German project adding 110,000 tonnes of sorting and 150,000 tonnes of melting and casting capacity, a 35,000-tonne billet expansion in the US, and the ramp-up of a 185,000-tonne plant at Al Taweelah in the UAE. These projects are part of EGA's broader strategy to become a leader in recycled aluminum, a key component in the low-carbon transition.
However, capacity figures alone do not tell the full story. In its August half-year report, EGA revealed that first-half revenue fell to $3.69 billion from $4.11 billion, due to lower sales volumes following an incident at Al Taweelah, despite higher realized aluminum prices. Sales of its RevivAL recycled aluminum totaled just 47,000 tonnes, only 1,000 tonnes more than the previous year. This highlights the importance of commercial throughput over nameplate capacity.
The balance sheet appears robust enough to support the build-out. EGA reported $1.65 billion in cash and term deposits and $1 billion in undrawn revolving credit at the end of June, after completing $5 billion in bank financing in the first quarter. Yet, without a disclosed purchase price, assessing the return on capital remains speculative.
The market context is also noteworthy. COMEX aluminum futures traded at $3,406.25 per metric tonne on Friday, September 11, down 1.3% from the prior day. This move is unrelated to the EGA deal, as Eco Green's volume is too small to influence global prices. The immediate impact is on European scrap competition and low-carbon metal supply.
For investors, the key metric to watch is the Nogara expansion, which EGA revised upward to 20,000 tonnes from 15,000 tonnes, with completion expected in December. If EGA can successfully convert its expanded scrap network into higher recycled metal sales and margins, the acquisition will prove strategically valuable. Otherwise, it risks becoming a larger footprint without corresponding returns.
