Alcoa shares jump on $1.6 billion stake sale in Saudi mining JV
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The news: US aluminium giant Alcoa shares rose on news that it had agreed to sell a 25.1% stake in its joint venture with Saudi Arabian mining company Ma’aden back to its partner.
The numbers: Alcoa will sell its stake in the JV for USD1.1 billion ($1.6 billion) in consideration for approximately 86 million shares of Ma’aden (worth around USD950 million) and another USD150 million in cash, Alcoa said in a statement. The deal is expected to close in the first half of 2025.
ASX-listed Alcoa shares were up 5.6% to $48.76 in early trading.
The context: Alcoa CEO William Oplinger said the transaction simplified its portfolio, enhanced visibility in the value of its investment in Saudi Arabia and provided greater financial flexibility for the group.
The joint venture was created in 2009, as a fully integrated mining complex in Saudi Arabia. Ma’aden owns the remaining 74.9% of the project.
The US aluminium giant has cut output and pared investments across the world as part of its cost-cutting measures. It completed a $3.4 billion takeover of its Alcoa World Alumina and Chemicals (AWAC) joint venture with Alumina earlier this year as part of those efforts, resulting in a listing of its shares on the ASX.
The source: ASX announcement
