(Reuters) – U.S. aluminum maker Alcoa (NYSE:) said on Sunday it would sell a 25.1% stake in its Ma'aden joint venture to Saudi mining company Ma'aden for $1.1 billion.
The transaction includes approximately 86 million Ma'aden shares and $150 million in cash, Alcoa said in a statement, adding that it expects to close the deal in the first half of 2025.
“The transaction simplifies our portfolio, improves visibility into the value of our investment in Saudi Arabia and provides greater financial flexibility for Alcoa,” said Alcoa CEO William Oplinger.
Alcoa said it would hold its Ma'aden shares for a minimum of three years. Once the transaction is completed, Alcoa would own approximately 2% of Ma'aden's shares currently outstanding.
The joint venture was created in 2009 as a fully integrated mining complex in Saudi Arabia, Alcoa said, adding that Ma'aden owns the remaining 74.9% of the project.
“We look forward to future opportunities for collaboration as we continue to build the mining sector into the third pillar of the Saudi economy,” said Bob Wilt, CEO of Ma'aden.
In July, Alcoa reported quarterly revenue of $2.9 billion, beating expectations of $2.8 billion.
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