Bahrain's Alba eyes expansion with $700m fund

The first tranche of facilities covered by Export Credit Agency will be used to finance the smelter's Power Station 5 and Power Distribution System projects

Alba's Line 6 will begin metal production in 2019.
Alba's Line 6 will begin metal production in 2019.

Aluminium Bahrain (Alba) has closed the first tranche, worth $700m (BHD264m), from facilities covered by Export Credit Agency (ECA).

The fund will be used to finance its Power Station 5 and Power Distribution System projects.

The facilities comprise a $310.4m (BHD117.1m) SERV Guaranteed Export Credit with an interest margin of 90 basis point per annum over the London Interbank Offered Rate (LIBOR); a $358.1m (EUR314.3m; BHD135.1m) SERV Guaranteed Export Credit with an interest margin of 65 basis point per annum over the Euro Interbank Offered Rate (EURIBOR); and a $57m (EUR50m; BHD21.5m) Hermes Guaranteed Export Credit with an interest margin of 55 basis point per annum over EURIBOR.

The SERV-covered facilities have 15-year tenor, while the Euler Hermes-covered facility has a 14-year tenor.

The principal amounts for each facility have to be repaid over a 12-year period.

The participating banks acting as the mandated lead arrangers for the ECA-covered facilities are Crédit Agricole Corporate and Investment Bank, Citibank, Commerzbank AG, JP Morgan Chase Bank, and Standard Chartered Bank.

Commerzbank AG acted as the facility agent for both, the SERV- and Euler Hermes-covered facilities.

Commenting on the development, Shaikh Daij Bin Salman Bin Daij Al Khalifa, chairman of Alba’s board of directors, said: “We look forward to securing the second tranche of the ECAs in order to accelerate the rapid growth of Alba with its brownfield Line 6 Expansion Project.”

Line 6 is expected to start metal production in early-2019.

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