Arconic Corp., whose operations include Arconic Davenport Works in Riverdale, Iowa, has been sold to Apollo Global Management in a $5.2 billion deal. CREDIT JOHN SCHULTZ
Anytime one of the region’s largest and most important businesses gets sold to a private equity firm there’s bound to be countless questions. And that’s certainly the case with Apollo Global Management Inc.’s purchase of Arconic Corp., the eighth-largest employer in the Quad-Cities, with 2,400 union and nonunion employees, according to the company. Arconic, headquartered […]
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Anytime one of the region’s largest and most important businesses gets sold to a private equity firm there’s bound to be countless questions.And that’s certainly the case with Apollo Global Management Inc.’s purchase of Arconic Corp., the eighth-largest employer in the Quad-Cities, with 2,400 union and nonunion employees, according to the company. Arconic, headquartered in Pittsburgh, Pennsylvania, has about 13,400 employees throughout the company.Apollo is a publicly traded global private equity firm with an estimated $512 billion in assets.Private equity has increasingly played a role in the life cycle of many businesses, especially ones that are considered not operating as profitable as the market might suggest. Typically, the private equity investment in the company will range from five to seven years and then it will exit or sell the company with the goal of making a significant return on investment.In a recent news article from Reuters, Apollo said it was committed to investing "significant capital" in Arconic, expected to be used for plant technology upgrades.The transaction, which includes a minority investment from Irenic Capital Management, comes at a time when high interest rates have sapped the appetite for private equity investments.Apollo also might be jumping on this opportunity at a bargain price. Arconic, which supplies materials to Boeing Co. and a number of industries, had rebuffed an almost $10 billion offer from Apollo in 2018, according to a report from the Reuters news service.An official with the United Steelworkers union Local 105, which represents about 1,800 workers at Arconic Davenport Works, said the deal may have no impact on the local plant.“It shouldn’t impact us at all. But we’re still gathering information on this right now,” Lee Shaffer, Local 105 guide, told the QCBJ.Whatever happens with the company during its time with private equity, we’re hopeful that the jobs and economic impact that have been part of the company in the Quad Cities for so long will remain intact.
Clinton’s big economic win
Clinton might not get the attention it deserves in the greater Quad Cities region, but its recent economic development win should help draw some. Clinton landed a new $200 million asphalt shingle manufacturing facility – ranking this economic development win as one of Clinton’s larger successes over the past decade.Atlas Roofing Corporation, a leading North American manufacturer of building products, plans to construct a 440,000-square-foot asphalt shingle plant on 148 acres in the park. The project represents a $224 million capital investment and is expected to create 117 jobs that pay $19.57 per hour, according to information from Andy Sokolovich, president and CEO of Grow Clinton.Congratulations to Clinton for this impressive economic development win.
