Alcoa will divest its full ownership stake in the Ma’aden joint venture (JV) to Saudi Arabian Mining Company (Ma’aden) for over $US1 billion.
Located in the Kingdom of Saudi Arabia, the Ma’aden JV was created in 2009 and comprises the Ma’aden bauxite mine and alumina refinery and the Ma’aden aluminium smelter and casthouse.
Under a new binding share purchase and subscription agreement, Alcoa will sell its 25.1 per cent investment in the JV to Ma’aden for approximately $US1.1 billion.
The transaction comprises approximately 86 million shares in the Ma’aden JV, which were valued at $US950 million, based on the volume-weighted average share price of the Ma’aden JV for the last 30 days as of September 12, as well as $US150 million in cash.
“We deeply value our partnership with Ma’aden,” Alcoa president and chief executive officer (CEO) William F. Oplinger said. “We are confident that under the new arrangement, MBAC (Ma’aden Bauxite and Alumina Company) and MAC (Ma’aden Aluminium Company) are well-positioned for success.
“The transaction simplifies our portfolio, enhances visibility in the value of our investment in Saudi Arabia and provides greater financial flexibility for Alcoa, an important part of improving our long-term competitiveness.”
As per the agreement’s terms, Alcoa will hold its Ma’aden shares for a minimum of three years, with a third of the shares becoming transferable after each of the third, fourth and fifth anniversaries of the transaction closing.
“Since 2009, Alcoa has been a valued partner of Ma’aden, and our aluminium business has benefited substantially from our strategic partnership,” Ma’aden CEO Bob Wilt said.
“We look forward to future opportunities to collaborate as we continue to build the mining sector into the third pillar of the Saudi economy.”
The transaction is expected to close in the first half of 2025.
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