‘Slowbalisation’ will define the decade, says KM Birla
MUMBAI: The next decade will be shaped by the retreat of globalisation because of widespread anger with the process and the rise of nationalism, Kumar Mangalam Birla, head of the $48 billion Aditya Birla Group, said.
Globalisation, Birla said, will make way for “slowbalisation”, the emerging pattern of trade that is more regional with multiple local operations.
“The tension between nationalism and globalisation is reshaping the world and will perhaps be the most defining trend as we head into a new decade. When Thomas Friedman coined the phrase that the world is flat, the world was a very different place. Back then he opined that technology and geopolitics were reshaping our lives while we were sleeping. Now that we are wide awake, I see a very different world dealing with the consequences of globalisation and its discontent,” Birla said in a statement on Linkedin on Tuesday.
At the same time, the new decade will focus on sustainability, Birla said, hailing teen environment activist Greta Thunberg as the conscience of Gen Z. “This generation is born into a post-hedonistic world, where the choices they make will be influenced not just by considerations of personal good but also of how they impact the world 50 years from now,” he said.
Birla admitted that his businesses have traditionally “looked at sustainability from the perspective of compliance and good governance. In this new environment, we need to think strategically about how to create business value through sustainable initiatives. Sustainability is, therefore, not just good citizenship but also, good business”.
Another major theme that Birla focused on was the importance of scale. “Scale is not everything. It’s the only thing … Dominant scale is not just about size. It is equally about achieving the widest reach, while replicating quality and service standards, across markets. When that happens, you truly become the No. 1 choice of customers,” he said.
ADITYA BIRLA GROUP IS IN TALKS TO EXTEND THE CLOSURE OF ITS DEAL WITH US ALUMINIUM PRODUCT MAKER ALERIS BY THREE MONTHS
ALERIS-NOVELIS DEAL
Aditya Birla Group is in talks to extend the closure of its planned acquisition of US aluminium products maker Aleris Corp. by three months due to delays in securing regulatory approvals, two people close to the development said.
In July 2018, Aditya Birla Group company Hindalco announced the $2.6 billion purchase of Aleris, with an outside date to complete the deal by January 21, 2020. Though China has already cleared the deal, authorities in the US and the European Union (EU) are still vetting the deal, and it is unlikely that it will close by its original deadline, the people cited earlier said on condition of anonymity. Aleris has 13 facilities across North America, Europe and China.
Aleris has long-term supply contracts with plane makers Boeing, Airbus and Bombardier, besides several carmakers. The acquisition will give Hindalco access to the aluminium supply market for the building and construction segments.
A Moody’s note dated January 13 sounded pessimistic that the deal will close by the original date. “The EU has advised it needs additional time to review the proposed buyer and this is not expected to be completed by the 21 January 2020 outside date in the merger agreement. Novelis is in discussions regarding the extension of this date,” it added.
An Aditya Birla Group spokesperson said, “Novelis remains fully committed to completing the Aleris acquisition and continues to work with all relevant parties to do so as quickly as possible.” On October 1, the European Commission cleared the deal, provided Aleris sells its Belgium plant making aluminium for the auto and specialties markets. In September, the US department of justice filed a civil antitrust lawsuit seeking to block the deal.