New York-based Alcoa Inc. announced Monday that the company made a $33 billion cash and stock bid to acquire Canadian Alcan Inc. Alcoa, the world’s second largest aluminum producer, offered $58.60 in cash plus 0.4801 in Alcoa Stocks per Alcan share, adding up to a total value of $73.25 per Alcan share, some 20 percent premium above Alcan’s closing price on Friday.

"This offer follows almost two years of discussions between our companies regarding a variety of potential business combination transactions, including unsuccessful board-level discussions of a merger last fall," Alcoa Chief Executive Officer Alain Belda said.

"We are very disappointed that those efforts did not result in a negotiated transaction," he added.

Alcoa used to be the world’s largest aluminum producer, followed by Alcan, by they were recently topped by OAO Russian Aluminium, after its three-way merge in March. If this deal goes through, Alcoa would regain its top position on the aluminum market.

Takeover talks have boosted Alcoa’s share value by some 25 percent compared to six months ago. Also, aluminum prices have surged some 64 percent in the last three years.

“It's better to be bigger,� Belda said at a press conference in Montreal yesterday. “As my father used to say, you have to be bigger than the hole you can fall in.�

Alcan is taking its time to consider the offer. The board has urged shareholders to postpone their decision pending a review of Alcoa’s bid.

If the merger succeeded, it would create a company with revenues of about $54 billion  and with 188,000 employees in 63 countries, as well as combined aluminum production capacity of 7.8 million tons per year.