NEW YORK – Zhongwang USA LLC, backed by Chinese aluminum magnate Liu Zhongtian, said on Monday it would buy U.S. aluminum company Aleris Corp in a bet by the billionaire that the nascent U.S. automotive aluminum sector will be the industry’s next big growth market.
The $2.33 billion deal comes as Liu and Zhongwang International Group Ltd, the parent of Zhongwang USA, are embroiled in a dispute over U.S. import duties amid broader trade tensions between the U.S. aluminum industry and China. It marks the biggest entry by a Chinese company into the U.S. aluminum industry since trade tensions began ramping up in recent years.
Zhongwang International is parent of China Zhongwang Holdings Ltd, the world’s second-largest producer of aluminum extrusions. It has been accused of evading U.S. import duties on extruded products, prompting an investigation by the U.S. Department of Commerce (DOC).