Alcoa Inc. said Monday it and the Saudi Arabian mining company, Ma'aden, will invest $10.8 billion in a joint venture to develop an aluminum industrial complex in Saudi Arabia.
The complex, which will range from a bauxite mine to production facilities, will be developed in two phases with initial production expected in 2014.
Ma'aden will own 60 percent of the joint venture. Alcoa will control the other 40 percent through an investment partnership in which it will own 20 percent.
Alcoa and its partners will invest $900 million over a four-year period as well as their share of the project financing.
The refinery, smelter and rolling mill will be established in an industrial zone of Raz Az Zawr on the east coast of Saudi Arabia. A bauxite mine will be developed at Al Ba'itha, near Quiba.
"By changing the operating dynamics and cost base within our industry, the complex will be a model for the growth of aluminum in competition with other metals," Klaus Kleinfeld, Alcoa president and CEO, said in a statement.
Shares of Alcoa rose $1.15, or 7.8 percent, to close at $15.73 Monday after an analyst upgraded the stock. Earlier in the session, shares traded at $15.98, a 52-week high.