UAE, Guinea sign bauxite supply deal

Updated 04 November 2012
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UAE, Guinea sign bauxite supply deal

DUBAI: Compagnie des Bauxites de Guinee (CBG) signed a long-term supply agreement with the UAE for bauxite, the main raw material in aluminum, the Gulf country’s state news agency reported.
The Emirates News Agency did not report the duration or value of the contract, which was concluded between CBG and the Emirates’ investment fund Mubadala Development Co.
But Guinean Mines Minister Mohamed Lamine Fofana was quoted as saying at a signing ceremony in Abu Dhabi that the deal would add $500 million to Guinea’s gross domestic product.

“The agreement with Mubadala will make a significant contribution to Guinea’s economy by enabling the expansion of CBG to more than 20 million metric tons of bauxite per year,” Fofana was quoted as saying by the news agency late on Friday.
Guinea’s government said in a separate press release that Mubadala had said it needs 5 billion tons of bauxite by 2017.
The Guinean company CBG — a joint venture between the Guinean state and a consortium of companies including Halco Mining Inc, Alcoa, Rio Tinto, and Dadco — has an annual production of 13.5 million tons.
A CBG official in Conakry told Reuters it would take the company at least three or four years to raise production to 20 million tons per year.
“We can’t do it right away,” he said.
“We will definitely need to proceed with an expansion project first.”
In March, Fofana said Guinea had started negotiations for Mubadala to take a stake in CBG. But Guinea said the supply deal did not result in Mubadala taking a stake.
Guinea is the world’s largest exporter of bauxite. The UAE’s Dubai Aluminium Co. (Dubal) produces around 1 million tons a year of aluminum, according to Gulf business website zawya.com.


Chinese smartphone maker Xiaomi lowers target as it kicks off IPO

Updated 40 min 37 sec ago
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Chinese smartphone maker Xiaomi lowers target as it kicks off IPO

HONG KONG: Chinese smartphone maker Xiaomi kicked off its initial public offering Thursday but the firm is likely to pull in about $6.1 billion, far less than originally expected, with investors having mixed views about its main business.
Xiaomi had hoped to raise $10 billion with the Hong Kong IPO, making it the biggest since Alibaba’s $25 billion New York debut in 2014 and valuing the company at about $100 billion.
However, the firm is offering 2.18 billion shares at HK$17-HK$22 apiece, according to Bloomberg News, which values it at about $53.9-$69.8 billion.
Xiaomi had hoped to be the first company to list shares in Hong Kong at the same time as launching new Chinese Depository Receipts (CDRs) in Shanghai under new rules announced in April by mainland authorities to open up markets in the world’s number two economy.
But on Tuesday it put off its decision on listing the CDRs until it completes its IPO in Hong Kong. The China Securities Regulatory Commission said it has canceled a listing review originally scheduled for June 19.
This delay, as well as differing market views about Xiaomi’s business model, were also among reasons for the lower valuation.
CEO Lei Jun claimed it was an Internet services company making money via online games and advertisements despite 70 percent of its revenues coming from selling hardware, particularly smartphones.
The firm, which mainly sells cheap but high-quality smartphones in China, is looking to push into Europe — recently opening its first flagship store in Paris — as the home market reaches saturation point.
China Mobile and US wireless-chip giant Qualcomm are among the cornerstone investors and it is expected to list on July 9.
Chinese authorities devised the CDR program, under which homegrown companies listed abroad can simultaneously list at home, after watching technology heavyweights Alibaba and Baidu list on Wall Street.
The objectives of the plan include helping to develop China’s still relatively immature and volatile share markets while allowing domestic investors to invest in the country’s big tech champions.
Alibaba and Hong Kong-listed Tencent have expressed an interest in the plan.
Xiaomi shipped 28 million smartphones worldwide from January to March, an 88-percent surge year-on-year.
That was fourth in the world after Samsung, Apple and China’s Huawei, according to figures from the International Data Corporation.