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Alcoa offered to buy Reynolds Metal Co. for $5.6 billion in cash and stock. The combined companies would have roughly $21 billion in revenue. Alcoa disclosed its offer the same day three other huge aluminum companies agreed to a merger that would create an aluminum concern with $25 billion in sales. Alcoa said it went public with its offer after first proposing a deal to Reynolds in March. The two companies failed to reach an agreement. The Alcoa offer values Richmond, Va.-based Reynolds at $65 a share. Alcoa and Reynolds are the world's first- and third-largest aluminum companies.

The Alcoa offer was announced after Zurich-based Alusuisse-Lonza (Algroup), Pechiney of France, and Alcan Aluminum of Canada announced their own merger plans. A share-swap arrangement among the companies would allow Alcan shareholders to receive 44 percent of shares in the new company, Pechiney shareholders 29 percent, and Algroup shareholders 27 percent. The firm would be registered in Montreal, but would be directed from New York, with Alcan chief Jacques Bougie as chief executive officer.

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(c) Copyright 1999. The Christian Science Publishing Society

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