Aluminium Bahrain (Alba), owner of the world's fourth-largest aluminium smelter, wants to take a stake in a mine or refinery as its impending expansion increases its demand for raw materials, its chief executive said.
The firm has begun feasibility work on a US$2.5 billion sixth production line which will increase annual capacity by 400,000 tonnes, when it comes online at the end of 2015, from its current production of 890,000 tonnes a year.
Given the additional demand for raw materials the new line will create, a focus on securing supplies at source instead of buying everything on the open market, becomes more important, Alba chief executive Tim Murray said on the sidelines of a conference in the capital Manama.
"For line six, it would probably be an interesting opportunity to look for maybe a joint venture partner or an equity swap," said Mr Murray, who was promoted from chief finance and supply officer in October.
Mr Murray added the firm may take a small stake in either a bauxite mine or a new or existing refinery, with India among likely options given its proximity to the Gulf Arab region in comparison with other candidates like Guinea.
Such decisions will form part of the expansion's feasibility study, which Bechtel Canada was appointed to undertake in December and which is due to be completed in the third quarter.
Much of the funding for the expansion will be raised from export credit agencies and both commercial and Islamic banks, with a bond also part of the package, Mr Murray said, adding the firm was currently securing a credit rating.
However, Alba has no plans to raise further corporate debt after securing bank loans in December to pay off a $169 million bond due to mature this month.
* Reuters
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Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
Will the pound fall to parity with the dollar?
The idea of pound parity now seems less far-fetched as the risk grows that Britain may split away from the European Union without a deal.
Rupert Harrison, a fund manager at BlackRock, sees the risk of it falling to trade level with the dollar on a no-deal Brexit. The view echoes Morgan Stanley’s recent forecast that the currency can plunge toward $1 (Dh3.67) on such an outcome. That isn’t the majority view yet – a Bloomberg survey this month estimated the pound will slide to $1.10 should the UK exit the bloc without an agreement.
New Prime Minister Boris Johnson has repeatedly said that Britain will leave the EU on the October 31 deadline with or without an agreement, fuelling concern the nation is headed for a disorderly departure and fanning pessimism toward the pound. Sterling has fallen more than 7 per cent in the past three months, the worst performance among major developed-market currencies.
“The pound is at a much lower level now but I still think a no-deal exit would lead to significant volatility and we could be testing parity on a really bad outcome,” said Mr Harrison, who manages more than $10 billion in assets at BlackRock. “We will see this game of chicken continue through August and that’s likely negative for sterling,” he said about the deadlocked Brexit talks.
The pound fell 0.8 per cent to $1.2033 on Friday, its weakest closing level since the 1980s, after a report on the second quarter showed the UK economy shrank for the first time in six years. The data means it is likely the Bank of England will cut interest rates, according to Mizuho Bank.
The BOE said in November that the currency could fall even below $1 in an analysis on possible worst-case Brexit scenarios. Options-based calculations showed around a 6.4 per cent chance of pound-dollar parity in the next one year, markedly higher than 0.2 per cent in early March when prospects of a no-deal outcome were seemingly off the table.
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