Saudi Arabian Mining Co. (Ma’aden) and the Kingdom’s Public Investment Fund (PIF), via their Manara Minerals Investment Co. joint venture, have signed a binding agreement to acquire a 10% stake in Brazilian group Vale SA’s Base Metals Ltd. unit, which produces nickel and copper.
The transaction is based on an enterprise value of $26 billion, Ma’aden said in a July 30 filing to Saudi’s Tadawul bourse. The deal, which is subject to regulatory approvals and other conditions, is expected to be completed in the first quarter of 2024.
“Vale has projects in world leading mining jurisdictions including Canada, Brazil, and Indonesia,” Ma’aden said. “Manara’s investment into Vale will play a key role in helping it expand the production of copper and nickel across its asset portfolio, which are critical to the development of new technologies that will benefit the global energy transition.”
Ma’aden, which operates several extraction sites and mines in Saudi Arabia to produce gold, copper, iron ore, strategic minerals, and phosphates, has a 51% stake in Manara, while the PIF holds a 49% interest. In June, Ma’aden said it would be increasing its share capital by SAR12.3 billion (approximately $3.27 billion at current exchange rates) to strengthen its capital base to boost growth.
Vale SA also reached a separate agreement on July 27 to sell a further 3% interest in its base metals unit to US investment firm Engine No. 1, according to media reports. The deals with Ma’aden and the US investment firm are part of Vale’s strategy to improve the management of nickel and copper assets, given expectations of soaring demand for the metals from the electric vehicle market.