Sources indicate that the modifications were crafted in collaboration with CITIC to safeguard the group's position if the shareholder vote favours the takeover. As of now, CITIC has yet to officially decide whether it will retain its stake in Alumina Ltd. or sell its shares in exchange for Alcoa stock.
Alcoa's all-stock offer for Alumina Ltd. now includes an additional provision: issuing non-voting convertible shares equivalent to 1.5 per cent of Alcoa's outstanding stock to CITIC Group. This adjustment ensures compliance with the US Bank Holding Company Act, which limits CITIC's ownership to no more than 5 per cent of any class of voting shares in a US public company. The shareholder vote on this offer is planned for the third quarter of this year.
Alcoa has already garnered the support of Alumina Ltd.'s largest shareholder, Allan Gray, who endorses and believes in the revised terms, as per the Financial Review report.
Allan Gray's Managing Director, Simon Mawhinney, described the deal as an "important transaction" and dismissed rumours that the amendments were preferential terms for CITIC—Allan Gray Australia Pty Ltd, currently the largest substantial holder in Alumina Limited.
