Alba Announces Non-Binding Agreement with Maaden
Media Release - 16 September 2024
Manama (ALBH)
Alba Announces Non-Binding Agreement to Explore Potential Business Combination with Segments of Maaden's Aluminium Strategic Business Unit
Manama, Bahrain - [16 September 2024]: The Board of Directors of Aluminium Bahrain B.S.C. (Alba) approved during its meeting on 16 September 2024 for Alba to enter into a non-binding agreement with Saudi Arabian Mining Company (Maaden) to commence due diligence towards a potential business combination involving segments of Maaden's aluminium strategic business unit.
This potential combination will reshape the global aluminium industry, positioning the merged entity as one of the largest aluminium producers worldwide. This partnership will create a larger, vertically integrated global champion with significant synergies offering advantages such as expanded production capacity; enhanced global presence; improved ESG performance; greater energy security; and significant shareholder value creation.
Alba's Chairman of the Board, HE Khalid Al Rumaihi, stated: "The potential partnership accelerates Alba's growth strategy, creating a global champion and cementing our position as the largest regional aluminium producer. This combination will allow both companies to scale-up production, extend our global presence and explore new opportunities in clean energy. Our partnership will not only deepen the strong ties between Bahrain and Saudi Arabia, but also contribute to Bahrain's economic diversification and job creation.
This is a compelling proposition and an exciting moment for Alba, Ma'aden, and our respective stakeholders, and we look forward to sharing further updates in due course."
Adding further, Ma'aden Chief Executive Officer, Bob Wilt, said: "Harnessing the combined scale and expertise of both businesses to forge a new global champion will not only advance Ma'aden's ambitions for aluminum but also significantly boost the economic ties between Bahrain and Saudi Arabia. By bringing together two of the region's most experienced players in the sector, we are setting the stage for stronger economic growth, enhanced job creation, and increased aluminum production capacity. This partnership will elevate our competitive edge on a global scale. Our continued commitment to our customers underpins this venture, ensuring that together, Ma'aden and Alba will provide access to a more expansive and reliable supply of aluminum. I look forward to working together with Alba as we better understand the ways in which we can come together to leverage this opportunity to deliver value for our employees, investors and economies."
During the due diligence period, both companies will exchange information and evaluate the strategic and financial benefits of a business combination. There is no assurance that these discussions will lead to a definitive agreement or a completed transaction.
As part of the discussions on the non-binding agreement, Alba and Ma'aden discussed, among other things, the potential transaction structure for implementing their proposed business combination and the potential cross-listing of Alba on the Saudi Exchange.
Subject to regulatory approvals (including, without limitation, the Central Bank of Bahrain), corporate approvals, confirmatory due diligence, and valuation assessments, the proposed structure would involve Ma'aden making an in-kind contribution. This would include Ma'aden contributing the entire share capital of two of its subsidiaries, Ma'aden Aluminium Company (MAC) and Ma'aden Bauxite and Alumina Company (MBAC), along with contractual rights concerning the marketing and sale of products produced by MAC, to Alba. In exchange, Alba would issue new shares to be allotted to Ma'aden.
Alba and Ma'aden have also agreed to discuss the cross-listing of Alba on the Saudi Exchange during the next phase of the proposed business combination.
Alba emphasises that the transaction is subject to, without limitation, confirmatory due diligence, receipt of all corporate (board and shareholder) and regulatory approvals and signing of definitive agreements. Alba will provide further information to the market and regulators as appropriate.
ENDS
About Aluminium Bahrain B.S.C. (Alba)
[Ticker: ALBH]
A Global Aluminium Leader: At plus-1.62 million metric tonnes per annum (mtpa) (2023), Alba is a world-leading aluminium smelter with a proud 50-year legacy in operational excellence, safety, environmental responsibility, and community development.
Trusted Partner: A cornerstone of the Bahrain's economy, Alba produces high-quality aluminium, including standard and value-added products, which are exported to over 270 customers globally. With sales' offices in Europe (Zurich), Asia (Singapore), and a subsidiary in the U.S., Alba is a reliable partner on the world stage. Alba is dually listed on Bahrain Bourse and London Stock Exchange and its shareholders are Bahrain Mumtalakat Holding Company B.S.C. © (69.38%), SABIC Industrial Investments Company (SIIC) (20.62%) and General Public (10%). Alba prioritizes the highest quality standards, reflected in its certifications: ISO 9001 (quality), ISO 14001 (environment), ISO 27001 (information security), ISO 45001 (occupational health and safety), and ISO 18788 (security operations management). Additionally, Alba demonstrates its commitment to responsible manufacturing through certifications like IATF 16949 (automotive quality), ISO 22301 (business continuity), and ASI Performance and Chain of Custody Standards. This dedication is further underscored by their top 1% Ecovadis Platinum rating for sustainability.
Pioneering Sustainability: As the first aluminium smelter in the Middle East, Alba is central to Bahrain's thriving downstream aluminium sector, contributing significantly to the Kingdom's GDP. Committed to social responsibility, Alba employs a workforce that is 86% Bahrainis (2023) and invests heavily in employee training and development. Alba also plays a crucial role in the Aluminium Downstream Park, therefore increasing the contribution of non-oil sectors to the GDP of Bahrain. Alba has been recognised for its initiatives to produce Aluminium responsibly through awards such as Top ESG performer in Bahrain by ESG Invest, Safeguard Label from Bureau Veritas and Best Corporate Governance Award by Ethical Boardroom.
Recognised for its environmental practices, social contributions, and corporate governance, Alba launched a comprehensive ESG Roadmap in 2022 focusing on 6 priority areas: (1) Decarbonisation, (2) Green Energy & Aluminium, (3) Circular Economy & Secondary Aluminium, (4) Employee Welfare, (5) Collaboration & Partnership and (6) Transparency, Communications & Due Diligence. Since its inception, Alba has invested into numerous environment, sustainable and socio-economic development projects that have had a positive impact on the society. Alba's first-of-its-kind US$37.5 million zero-waste Spent Pot Lining Treatment Plant, the upcoming +6 MW Solar Farm Project and the Power Station 5 Block 4 Project are tangible initiatives aligned with Bahrain's Net Zero Carbon Targets by 2060 led by HRH the Crown Prince and Prime Minister of Bahrain.
In a significant step towards its ESG goals, particularly its commitment to a circular economy and secondary aluminium, Alba introduced EternAl, its new line of low-carbon aluminium products. Launched in May 2024, EternAl offers two initial variants: EternAl-30 and EternAl-15, containing 30% and 15% recycled content respectively.
Safety First, Always: Guided by the motto "Safety First, Safety Always," Alba prioritises the well-being of its employees and contractors. The Company achieved a record-breaking 30 million safe working hours without a lost-time injury in September 2022. The Company has been recognised internationally for its excellent Safety and Health track record with awards such as the RoSPA President's Award for winning RoSPA Gold Medal Award 10 years in a row, the British Safety Council's International Safety Award with Merit along with 4-Star Audit Rating, as well as numerous awards from the National Safety Council (NSC).
Alba Power Station 5 (PS5) Block 4 Expansion Project
Alba's PS5 Block 4 is a new 680.9-megawatt (MW) combined-cycle power plant that expands the existing PS5 facility. This state-of-the-art J-class gas turbine addition boasts superior efficiency compared to Power Stations 3 & 4. Scheduled for completion in Q4 2024, Block 4 will boost PS5's total capacity to 2,481 MW, while reducing greenhouse gas emissions by 0.5 tonnes of CO2 per tonne of aluminium produced.
A consortium of Mitsubishi Power and SEPCOIII is responsible for the entire project lifecycle, from design and engineering to construction and commissioning. Alba has achieved in April 2024 the first fire of the state-of-the-art GT for Block 4 Project.
Alba Stakeholder Engagement Plan
Alba prioritises open communication with all its stakeholders, including the community, environmental and social groups. Through its Stakeholder Engagement Plan, the Company proactively addresses environmental and social impacts of its operations, outlining clear mitigation controls. Alba also maintains an external Grievance Mechanism accessible through the Code of Conduct, allowing stakeholders and the public to voice concerns and raise issues.
Scan the above to Alba's Stakeholder Engagement Plan
Alba's External Grievance Mechanism
Alba prioritises ethical conduct and environmental responsibility. Stakeholders, employees, contractors, and the community can confidentially report any potential breaches of Alba's Code of Conduct or raise concerns about environmental and social impacts through the Alba Integrity Line. This independent, multilingual hotline operates 24/7 and is accessible via a toll-free phone number, the company intranet, or the website at www.albasmelter.com.
Scan the above to Alba's Code of Conduct
For further details, please contact:
Eline Hilal
Director, Investor Relations, Insurance & Corporate Secretary
Investor Relations Department
Tel: (973) 1783 5100
E-mail: eline.hilal@alba.com.bh
Website: www.albasmelter.com
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