Saudi Arabian Mining Company (Ma'aden) said on Monday it has signed a non-binding agreement with Aluminium Bahrain (Alba) to pursue a potential business combination to create a global aluminium powerhouse.
Ma'aden agreed to buy shares in Alba in exchange for the entire share capital of two of its subsidiaries - Ma'aden Aluminium and Ma'aden Bauxite and Alumina - which were part of a joint venture with Alcoa.
A day before this agreement, the US-based aluminium maker Alcoa sold its 25.1% stake in the joint venture to Ma'aden for about $1.1-billion in a cash-and-stock deal.
"This combination will allow both companies to scale up production, extend our global presence and explore new opportunities in clean energy," said HE Khalid Al Rumaihi, Alba's chairman of the board.
Ma'aden did not disclose the financial terms of the non-binding agreement and added that, as part of the due diligence process, the companies would discuss Alba being listed on the Saudi Exchange. 