Aluminium Bahrain (Alba) raised $338m out of its targeted $541m after an initial public offering (IPO) of an 11.5 per cent stake priced at the bottom of the range.

The final offering price is BD0.900 per ordinary share out of a BD0.900-BD1.250 range, and $11.97 per global depository receipt (GDR), with one GDR representing five ordinary shares.

The final price was determined through a bookbuilding process, with 75 per cent of the total deal size allocated in the form of ordinary shares and GDRs in the institutional offering, while 25 per cent was allocated in the form of ordinary shares in the retail offering.  

The shares will be listed on the Bahraini bourse and as GDRs on the London Stock Exchange (LSE) on or about 30 November.  

The IPO, which was fully subscribed, was offered by Bahrain sovereign wealth fund Mumtalakat and reduces its majority stake to 69.38 per cent from 77 per cent.   

Mumtalakat will invest proceeds from the IPO in international markets as part of its plan to diversify away from local investments.   

The fund said in 2008 that it was planning to increase the share of international investments in its portfolio from about 2 per cent to 50 per cent. So far though, progress has been slow, and the company said in March 2009 that it was focusing on managing existing assets.

“The aluminium sector has a positive global outlook, having seen the price of aluminium for three-month delivery on the London Metal Exchange (LME) rise 8 per cent this year,” said Mahmood Al Kooheji, chairman of Alba in a statement issued by the company on 8 November.

Alba is the world’s fourth-largest individual producers of aluminium by capacity, with an average annual production of 870,000 metric tonnes. It reported a profit of over $200m for the first half of 2010.