Emirates Global Aluminium likely to delay float after market turmoil

EGA, which produces 2.6 million tons of cast metal a year and is the third-largest producer of primary aluminum outside China, announced plans to float last year. (Courtesy EGA)
Updated 10 May 2018
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Emirates Global Aluminium likely to delay float after market turmoil

LONDON/ABU DHABI: Emirates Global Aluminium’s (EGA) stock market listing is likely to slip to 2019 because of turmoil in global aluminum markets after the US imposed sanctions on Russian aluminum group Rusal, three sources familiar with the deal said.
“The IPO (initial public offering) is delayed to 2019 due to market conditions,” one of the sources said.
EGA, which produces 2.6 million tons of cast metal a year and is the third-largest producer of primary aluminum outside China, announced plans to float last year.
But aluminum prices have been volatile since Washington, in response to what it called “malign activities” by Russia, imposed sanctions on Rusal and shareholder Oleg Deripaska. Benchmark prices on the London Metal Exchange surged to their highest in seven years.
They dropped back by around 9 percent when the US Treasury Department said Rusal’s American customers would have more time to comply with the sanctions. The US Treasury also said it would consider lifting them if Russian tycoon Oleg Deripaska ceded control of the company.
In April, just after the sanctions on several Russian entities took hold, EGA’s chief executive said the company was on track for a listing in the second half of 2018.
“We maintain what we’ve said earlier that it will be 2018, subject to market conditions and we continue to monitor the markets,” an EGA spokesman said on Thursday.
EGA’s IPO would be the second major listing by a state company in the United Arab Emirates since Abu Dhabi National Oil Co. (ADNOC) listed shares in its retail petrol station business in 2017.
The sources said no final decision had been taken on whether the listing would take place in Abu Dhabi or Dubai, while a secondary listing in London was still a possibility. About 10 to 15 percent of the company is likely to be floated, they said.
Sources had previously said that Bank of America Merrill Lynch, Goldman Sachs and J.P. Morgan had been hired to run the IPO.
EGA, owned by Mubadala and Investment Corp. of Dubai, was created in 2013 when state-owned companies Dubai Aluminium and Abu Dhabi’s Emirates Aluminium merged. Its enterprise value was put at $15 billion at the time.
In February, EGA reported a 59 percent rise in 2017 profit to 3.3 billion dirhams ($900 million) on stronger aluminum prices and record production levels.


‘Don’t be too optimistic’: Huawei employees fret at US ban

Updated 26 May 2019
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‘Don’t be too optimistic’: Huawei employees fret at US ban

  • This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei
  • Another critical partner, ARM Holdings, said it was complying with the US restrictions

BEIJING: While Huawei’s founder brushes aside a US ban against his company, the telecom giant’s employees have been less sanguine, confessing fears for their future in online chat rooms.
Huawei CEO Ren Zhengfei declared this week the company has a hoard of microchips and the ability to make its own in order to withstand a potentially crippling US ban on using American components and software in its products.
“If you really want to know what’s going on with us, you can visit our Xinsheng Community,” Ren told Chinese media, alluding to Huawei’s internal forum partially open to viewers outside the company.
But a peek into Xinsheng shows his words have not reassured everyone within the Shenzhen-based company.
“During difficult times, what should we do as individuals?” posted an employee under the handle Xiao Feng on Thursday.
“At home reduce your debts and maintain enough cash,” Xiao Feng wrote.
“Make a plan for your financial assets and don’t be overly optimistic about your remuneration and income.”
This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei as a result of the ban.
Another critical partner, ARM Holdings — a British designer of semiconductors owned by Japanese group Softbank — said it was complying with the US restrictions.
“On its own Huawei can’t resolve this problem, we need to seek support from government policy,” one unnamed employee wrote last week, in a post that received dozens of likes and replies.
The employee outlined a plan for China to block off its smartphone market from all American components much in the same way Beijing fostered its Internet tech giants behind a “Great Firewall” that keeps out Google, Facebook, Twitter and dozens of other foreign companies.
“Our domestic market is big enough, we can use this opportunity to build up domestic suppliers and our ecosystem,” the employee wrote.
For his part, Ren advocated the opposite response in his interview with Chinese media.
“We should not promote populism; populism is detrimental to the country,” he said, noting that his family uses Apple products.
Other employees strategized ways to circumvent the US ban.
One advocated turning to Alibaba’s e-commerce platform Taobao to buy the needed components. Another dangled the prospect of setting up dozens of new companies to make purchases from US suppliers.
Many denounced the US and proposed China ban McDonald’s, Coca-Cola and all-American movies and TV shows.
“First time posting under my real name: we must do our jobs well, advance and retreat with our company,” said an employee named Xu Jin.
The tech ban caps months of US effort to isolate Huawei, whose equipment Washington fears could be used as a Trojan horse by Chinese intelligence services.
Still, last week Trump indicated he was willing to include a fix for Huawei in a trade deal that the two economic giants have struggled to seal and US officials issued a 90-day reprieve on the ban.
In Xinsheng, an employee with the handle Youxin lamented: “I want to advance and retreat alongside the company, but then my boss told me to pack up and go,” followed by two sad-face emoticons.