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Emirates Global Aluminium wants to invest in EgyptAlum via a capital raise: Emirates Global Aluminium (EGA) is in early-stage talks with the government to make undisclosed investments in state-owned, EGX-listed Egypt Aluminium (EgyptAlum) through a capital increase, Al Borsa reports, citing Public Enterprises Minister Mahmoud Essmat. The minister did not provide further details about how much money the company could invest or the equity stake it could receive.
Where’s the money going? EGA’s potential investment would be earmarked for building a new factory to produce bauxite, the raw material needed for the production of aluminum, which is seeing rising demand overseas, according to Al Borsa. The government has already agreed to allocate land for the potential factory in Safaga, on the condition that the plant uses solar plants to produce its electricity.
The government is also contributing to the project: A portion of the investment will be contributed by the government, in addition to providing the land, Essmat reportedly said, without specifying the expected size of the government’s investment.
EgypAlum didn’t confirm or deny the news, saying in a bourse disclosure (pdf) yesterday that it is exploring all options. The company wants to revamp its aluminum complex, increase annual production capacity by 100k tons, and establish a new factory to produce aluminum foil, it said.
About EgyptAlum: EgyptAlum is majority-owned by the state-owned Metallurgical Industries Holding (89.8%), and El Nasr Mining Co. (2.2%), while the rest of the shares are free-floated on the EGX, according to the company’s shareholders structure report (pdf). The company is coming off a strong 2022, which saw its more than double its net income to EGP 1.7 bn in 2H 2022, according to its financials (pdf).
About EGA: The aluminum giant is owned equally by Mubadala Investment Company of Abu Dhabi and Investment Corporation of Dubai. It produces some 4% of the world’s aluminum, according to the company’s website.
Market reax: EgyptAlum’s share price rose 4.5% to EGP 32.40 on yesterday’s close.
