February 2005 (Revised July 2005)
Case
HBS Case Collection

Aluminium Bahrain (Alba): The Pot Line 5 Expansion Project

Format:Print
| Pages:23

Abstract

In September 2002, Aluminium Bahrain (Alba) needed to decide how to finance its proposed $1.7 billion pot line. The company's financial adviser, Taylor De-Jongh (TDJ), had recommended Alba employ a multisourced financing strategy using as many as five sources of debt from international, regional, and local capital pools. TDJ believed that the strategy would generate competition among the lenders which, in turn, would save Alba millions in financing costs. But the multisourced financing strategy went against the grain of typical project financings in the Middle East and was not without its risks. Alba management must decide how many financing sources to use, which ones, and how much to get from each one. If the market rejects the multisourced financing strategy, the project might become tainted, which could jeopardize Alba's long-term growth objectives.

Keywords

Project Finance; Emerging Markets; Financing and Loans; Investment; Capital; Financial Strategy; Manufacturing Industry; Bahrain

Citation

Esty, Benjamin C., and Aldo Sesia. "Aluminium Bahrain (Alba): The Pot Line 5 Expansion Project." Harvard Business School Case 205-027, February 2005. (Revised July 2005.)