Novelis (NVL) Up on More Takeover Rumors

Novelis Inc. (NYSE: NVL) is moving higher again today on talk a takeover offer from Hindalco could be announced soon. Reports today suggest Hindalco could make a $6-$8 billion bid, higher than the $5-$6 billion price range originally discussed.

In Late January, Novelis confirmed it was in discussions with various parties that could lead to a potential sale of the Company.

Davenport Comments on Novelis (NVL) Takeover Rumors

Davenport comments on Novelis Inc. (NYSE: NVL) following reports on Friday that Aditya Birla Group could make an offer for the company. The firm said the reported price range of $5-$6 billion, including the assumption of $2.4 billion in debt, would put a potential offer at $35-$49 share. Analyst Lloyd O'Carroll said there is very little overlap between Hindalco and NVL's downstream business, and thus not a lot of synergies. O'Carroll said the lack of synergies may no dissuade Hindalco. He also notes that in January, Hindalco was rumored to be bidding for a division of Alcan, but quickly denied the report. They have yet to hear a response from Hindalco on NVL.

The firm also thinks there are multiple bidders for NVL. They think NVL could be valued up to $68 per share on a takeover basis, based on the NPV of free cash flows through 2010.

The firm maintains their Buy rating and raises their price target from $33 to $45.

Novelis (NVL) Buyout Talks

Novelis Inc. (NYSE: NVL) confirmed earlier takeover rumors. The company said it is in discussions with various parties that could lead to a potential sale of the Company.

The stock is still halted.

Reports Novelis (NVL) Could Be Acquried

Aditya Vikram Birla group is exploring the possibility of acquiring Novelis (NYSE: NVL). According to the Hindustan Times citing highly placed sources, the group could offer $5-6 billion.

The article also says the group has already completed preliminary due diligence and now has management support to move forward with a bid.

The stock is currently halted.