KUALA LUMPUR (March 25): Press Metal Aluminium Holdings Bhd’s (KL:PMETAL) 21.75%-owned Hong Kong unit, Nanshan Aluminium International Holdings Ltd (NAIHL), had a soft debut on the Hong Kong Stock Exchange (HKEX) on Tuesday, registering a 5.08% drop in share price.

The company, bearing the stock code “2610”, was listed on the Main Board of HKEX with an initial public offering (IPO) price of HK$26.60 (RM15.18), projected to generate net proceeds of HK$2.22 billion.

The proceeds will be primarily used for building and expanding the second one-million-ton alumina production facilities in Bintan, Indonesia.

The plans include building related alumina production facilities, constructing ancillary equipment at a deep-water port, expanding capacity in the coal gasification plant, and acquiring machinery and equipment.

In July 2024, Press Metal completed a share swap exercise, exchanging a 25% stake in aluminium oxide producer PT Bintan Alumina Indonesia (PTBAI) for a 25.59% stake in NAIHL.

As part of the exercise, Press Metal sold its 25% stake in PTBAI to Hong Kong Prime Aluminium Investment Ltd (HKPAI) for US$329.8 million (RM1.46 billion), to be fully settled through the issuance of a promissory note by HKPAI to Press Metal. HKPAI is a wholly owned unit of NAIHL.

Simultaneously, Press Metal will subscribe for 25.99 million shares, equivalent to a 25.59% stake in NAIHL, via its subsidiary Press Metal International Resources (HK) Ltd. This subscription will also be fully satisfied through a promissory note issued to NAIHL.

In 2020, Press Metal had acquired the 25% stake in PTBAI to secure a stable supply of alumina, which is one of the key raw materials it needs for its smelting operations, and to reduce reliance on third-party suppliers. Meanwhile, NAIHL controlled 72.7% in PTBAI, held indirectly via its wholly owned subsidiaries.

In the first nine months ended Sept 30, 2024 (9MFY2024), NAIHL’s net profit more than doubled to US$266.33 million from US$117.44 million a year ago, as its revenue rose 41.5% to US$683 million compared to US$482.7 million in 9MFY2023.

Press Metal, along with other controlling shareholders of NAIHL, namely Nanshan Aluminium Investment Holding Ltd and Redstone Alumina International Pte Ltd, will be subject to a lock-up period until March 24, 2026.

Cornerstone investors face a lock-up period ending Sept 24, 2025. These investors include Glencore International AG, a global commodity trading giant, and Hongkong Topway Trading Co Ltd, an indirect subsidiary of the Chinese-listed supply chain operator Xiamen Xiangyu Co Ltd, each holding a 2.48% stake in NAIHL.

Other cornerstone investors are Reijong International Industrial Equipment (HK) Ltd with a 0.51% stake and PT Indika Energy Tbk, which holds 0.5%.

At the close of HK$25.25 on its market debut, NAIHL is valued at a market capitalisation of HK$14.85 billion.

Meanwhile, Press Metal shares closed one sen or 0.2% higher at RM5, giving it a market capitalisation of RM41.19 billion.

Read also:
Press Metal swaps stake in PT Bintan Alumina for 25.59% in Hong Kong's Nanshan Aluminium in RM1.55b deal ahead of spin-off listing