According to sources with knowledge of the situation, United Arab Emirates’ Emirates Global Aluminium is contemplating an initial public offering in the near future.
The anonymous sources who spoke to regional media indicated that the firm is seeking advisers to assist in an IPO in the domestic stock exchange. Such a move is designed to take advantage of a comeback in commodities prices, explained the sources.
A representative of EGA had no comment when contacted by local media. According to the sources above, the IPO is not “set in stone” and the plan may be shelved at any time.
EGA is in a strong position with investors after turning in a ten-percent jump in its profits last year, netting US$572 million for the year. Production was up last year as well, rising by 4.2 percent to a record 2.5 million metric tons and catapulting the company into the world’s fourth-biggest producer of aluminium.
The prevalence of IPOs in the Mideast may be on the rise as countries in the region are attempting to diversify their economies, lessening dependence upon petroleum. Saudi Arabia may see the biggest such IPO in the area when it lists Aramco later this year.
Investors may be ready to fund just such a move, as commodities prices are beginning to rise. The LME’s index of six metals has risen by 28 percent over the past twelve months, with aluminium seeing a fifteen-percent rise since the first of the year.
Based in Abu Dhabi, United Arab Emirates, EGA is an aluminium conglomerate created by the merger between Dubai Aluminium and Emirates Aluminium in 2013. EGA holds interests in bauxite/alumina and primary aluminium smelting. It has a yearly production of aluminium of 2.4 million metric tons, making it one of the five largest primary aluminium producers in the world.