Maaden issues circular on capital hike to buy Alcoa, AWA stakes in subsidiaries

Saudi Arabian Mining Co. (Maaden) published the shareholders’ circular regarding the company’s planned capital increase aimed at acquiring the entire shares held by Alcoa Smelting Investments Saudi Arabia B.V. in Maaden Aluminium Co., and the entire ownership of Awa Saudi Limited in Maaden Bauxite and Alumina Co.

The Capital Market Authority (CMA) approved, on June 2, Maaden’s request to increase its capital from SAR 38.03 billion to SAR 38.89 billion, through issuing 85.98 million ordinary shares.

On Sept. 15, 2024, Maaden signed a share purchase and subscription agreement (SPSA) with Alcoa (guarantor), AWA Saudi (first seller) and Alcoa Saudi Smelting Inversiones S.L (second seller).

Through the deal, Maaden seeks to acquire the entire 25.1% stake (128.01 million ordinary shares) held by AWA in Maaden Bauxite & Alumina (MBAC) and Alcoa Saudi’s 25.1% stake (165 million ordinary shares) in Maaden Aluminium (MAC).

Based on a valuation of SAR 4,13 billion, the acquisition consideration will consist of a cash payment by Maaden to first seller of SAR 562.5 million.

The remaining acquisition consideration of SAR 3.56 billion to be paid through the issuance of new shares in Maaden to the sellers (or any designated affiliate).

It will be calculated on a formula based on the volume-weighted average price of Maaden shares, representing about 2.21% of the mining firm’s share capital after acquisition.

Upon completion of the acquisition deal, Maaden’s current shareholders will hold 97.79% of the company’s share capital following the capital increase, while the sellers will own 2.21%.

MBAC's capital is SAR 5.1 billion, divided into 510 million ordinary shares, at a par value of SAR 10 per share, of which Maaden currently owns 74.9%.

Meanwhile, MAC's current capital is SAR 6.57 billion, divided into 657.38 million ordinary shares, at a par value of SAR 10 per share, of which Maaden currently owns 74.9%.