Alcoa CFO calls bid for Alcan fair

By Steve James

NEW YORK (Reuters) - Alcoa's (AA.N: Quote, Profile, Research, Stock Buzz) $27.6 billion takeover offer for Canadian rival Alcan AL.TO AL.N is fair, the U.S. aluminum company's chief financial officer said on Tuesday, shortly after Alcan's board rejected the bid.

"Our offer is full, fair and balanced," Charles McLane told the Reuters Global Mining and Steel Summit in New York.

During the interview with Reuters journalists, Alcan announced its board was recommending that shareholders reject the unsolicited offer.

But McLane declined to comment on specifics of the rejection until he could review it with fellow Alcoa executives.

Two hours later, spokesman Kevin Lowery said the company was reviewing Alcan's response "and will provide a more in-depth response after we have time to examine it further."

He said Alcoa's offer "provides attractive value to Alcan shareholders."

McLane said the merger, if it gets the necessary regulatory approvals from the United States, Canada, Australia, the European Union and other bodies, could close by the end of the year.

Asked about businesses that might overlap after a merger and pose antitrust hurdles, McLane said: "Expressions of interest have been made."

He said Alcoa's offer for its Montreal-based rival had been under discussion for two years. "It was us approaching them.

"We didn't go into this without open eyes," he added, noting that there could be other interested bidders.

Pittsburgh-based Alcoa announced its hostile bid for Alcan on May 7. If successful, the bid would create the world's largest producer of aluminum, which is used in products ranging from beverage cans to airplanes.

Asked what the company would do if the Alcan deal was unsuccessful, McLane said: "We have other directions, but I'm not at liberty to talk about what those may be.

"We're not going to take our eyes off this one specific transaction. This one makes the most sense to us."

He said Alcoa executives had met with some Alcan and Alcoa shareholders and "without exception ... we have had no negative feedback. Zero."

He said they mostly asked, "Why now?" and his reply was "Why not?"  Continued...