Mubadala Investment Company, an Abu Dhabi government-owned strategic firm with US$127 billion in assets, plans to take Emirates Global Aluminium (EGA) public through a share float next year, said Mubadala's group chief executive said.
"We hope to take this company [EGA] public in 2018," Khaldoon Al Mubarak said at the Future Investment Initiative conference in Riyadh.
“It’s a great story,” he said of the company’s evolution as a global industrial champion but did not give details of the planned initial public offering.
EGA, which is jointly owned by Mubadala Investment and Dubai government sovereign wealth fund Investment Corporation of Dubai, was formed after the 2013 merger of Dubai Aluminium and Emirates Aluminium of Abu Dhabi. The company has already appointed Bank of America Merrill Lynch, Goldman Sachs and JP Morgan to advise on the IPO, according to Reuters.
IPOs have dried up recently on regional stock exchanges, including the UAE's two main securities exchanges as investors remain cautious amid slowing economies. Firms are also seeking higher valuations for their businesses and have put listing plans on hold.
Stock market activity in the UAE, however, is expected to be boosted, with some large share floats slated for this year and next. Emaar Properties, the biggest listed developer in the country, confirmed plans to sell 20 per cent of its real estate development businesses in November.
Abu Dhabi National Oil Company may also sell shares in its Adnoc Distribution unit, which includes more than 300 service stations throughout the UAE. The company could be valued up to $14bn, making it potentially the largest transaction on local equity markets since the DP World listing in 2007, according to Bloomberg.
An EGA IPO next year could be another large-ticket deal to come to the market. Mr Al Mubarak described the company as an "industrial powerhouse", in September and said it was performing strongly.
“What I can say right now is the company is growing its value chain proposition very well. Our aluminium smelters in both Taweelah and Jebel Ali are performing extremely well, both in terms of cost and in terms of profitability,”
Mr Al Mubarak said at
The company, which has made significant investments in an alumina refinery in the UAE, expects to have operations across the aluminium value chain in 2018, when its refining facility is expected to come online.
The firm has already invested $1.2bn in in bauxite mining in Guinea, which has some of the best reserves the lowest cost of production and and has two smelting facilities at Taweelah in Abu Dhabi and Jebel Ali in Dubai.
It currently serves more than 350 industrial customers in 60 countries around the world and 8 per cent of EGA production is value-added products, according to Mr Al Mubarak.
"In terms of the GDP contribution to the UAE, we contribute about $5bn per year," he said.