United Arab Emirates-based Emirates Global Aluminium (EGA) is exploring an acquisition of Companhia Brasileira de Aluminio, two sources said, as the Brazilian producer’s operations along the entire production chain have made it an attractive target.
EGA, jointly owned by the Abu Dhabi sovereign wealth fund Mubadala and the Dubai sovereign wealth fund Investment Corporation of Dubai, is working with Morgan Stanley as its investment banking adviser on the potential deal, the people with knowledge of the matter said.
CBA had a market capitalisation of $487 million as of Monday’s close, according to LSEG data. CBA’s shares rose 6% on Tuesday morning after Reuters’ report on EGA’s interest.
The two sources spoke on condition of anonymity because the matter is private. Reuters could not determine if an offer has been made.
CBA, in which Brazilian conglomerate Votorantim S.A. owns a 69% stake according to LSEG data, produces low-carbon aluminium across seven Brazilian states.
Its operations encompass the entire aluminium production chain, from bauxite mining and refining to smelting and manufacturing diverse primary aluminium products.
CBA is an “all-inclusive asset” with upstream operations, its own mines and access to bauxite that could strengthen an investor’s market positioning, one source said.
EGA said it continually evaluates potential opportunities for growth, but does not comment on market rumours and speculation.
CBA, Morgan Stanley and Votorantim declined to comment.
Earlier this year EGA predicted volatility in aluminium prices would continue this year due to tensions in global trade. President Donald Trump has imposed tariffs on steel and aluminium imports into the United States, which is a key market for United Arab Emirates suppliers.
EGA was among a group of companies agreeing $200 billion worth of deals with the Trump administration after the president’s visit to the region in May.
EGA said it would invest to develop a $4 billion primary aluminium smelter project in Oklahoma, the first new “primary” aluminium production plant in the U.S. since 1980, according to its press release.
The plans are subject to securing a competitive long-term power supply for the plant, state and local investment incentives and tax credit arrangements, the company said, which added it was in advanced negotiations with the Public Service Company of Oklahoma (PSO) and the Oklahoma government.
EGA said in March that annual net profit for 2024 declined by 23.5% due to an impairment charge following the suspension of exports from its operations in Guinea and the introduction of a corporate tax in the United Arab Emirates.
Source: Reuters.com