Saudi Ma’aden to buy nearly 21% stake in Bahrain’s Alba for $1bn

Image credit: Aluminium Bahrain (Alba)

Saudi Arabian Mining Company, also known as Ma’aden, said on Wednesday that it has agreed to acquire SABIC’s 20.62 per cent stake in Aluminium Bahrain (Alba), the company’s third deal in as many days as the kingdom looks to accelerate the expansion of its metals and mining industry.

The sale proceeds are expected to be between $963.25m-$1.06bn (BHD363m-398m), SABIC said in a bourse filing, adding that the proceeds will be used to help its growth in the chemicals industry.

“The transaction will enable SABIC to optimise its portfolio, focus on its core business, and further strengthen its growth in the chemicals industry,” the petchems behemoth said in a statement.

“As we continue in our growth journey, the acquisition of shares in a highly experienced, well-developed regional and global aluminium player firmly supports our ambitions,” said Bob Wilt, the CEO of Ma’aden.

“This week, we have announced a number of transactions that align with our strategic intent to strengthen and expand our business both regionally and internationally, further building mining as the third pillar of the Saudi economy.”

On Sunday, Ma’aden bought out US aluminium maker Alcoa from two aluminium plants for $150m (SAR563m) in cash and SAR3.6bn of stock in the Riyadh-based miner. The following day (Monday), Ma’aden said it was exploring merging its aluminium assets with Bahrain’s Alba.

Ma’aden would sell the entire share capital of the units — Ma’aden Aluminium Company and Ma’aden Bauxite and Alumina Company — to Alba, and the Bahrain Bourse-listed company would, in exchange, issue new shares for allotment to Ma’aden.

Both parties also agreed to seek a cross-listing of Alba shares on the Saudi Exchange.

Alba is among the world’s largest aluminium smelters outside of China, producing more than 1.55 billion metric tonnes per annum. Its top shareholders are Bahrain Mumtalakat Holding Company (69.38 per cent) and SABIC (20.62 per cent).

Ma’aden and Alba have emerged as major players in the global aluminium industry in recent years, particularly in value-added products that a handful of suppliers have historically dominated.

Last year, Ma’aden joined forces with the Public Investment Fund to form a company that will be funded with as much as SAR11.95bn to invest in mining assets internationally. The venture, known as Manara Minerals, signed its first deal in August 2023 involving the acquisition of a 10 per cent stake in Vale’s base metals unit at an implied enterprise value of $26bn.

Read: Saudi Ma’aden plans to sell aluminium units to Bahrain’s Alba