The deal has been finalized after months of talks between PIF and Aramco, which caused a delay of Aramco’s planned multi-billion-dollar IPO
Saudi Aramco has reportedly announced it will buy a 70% stake in Saudi Basic Industries Corp (SABIC), currently held by Public Investment Fund (PIF) of Saudi Arabia, in a historic deal worth nearly $69.1 billion.
Aramco and SABIC mentioned that the agreed purchase price of this deal is 123.39 riyals per share which was a slight discount from the closing price of SABIC.
Managing director of the Public Investment Fund (PIF), Yasir Othman Al-Rumayyan stated that this transaction is a win-win deal the three most important economic entities of Saudi Arabia. The deal has been finalized after months of discussions between PIF and Aramco which led to the delay of planned multi-billion-dollar initial public offering of Aramco.
Sources familiar with the matter informed that Aramco has been strengthening its investment in the field of petrochemicals and refining to secure other new markets for its crude, as it sees profound growth in chemicals key to its downstream expansion strategy.
Apparently, this deal has represented a historic moment for the company and a great opportunity for growth, a company official said.
According to SABIC CEO and Vice Chairman, Yousef Al-Benyan, reinforcing their relationship efficiently, it is strategically positioning Saudi Aramco and SABIC to accelerate developments in their global chemical business.
Further reports indicate that Aramco has no plans to buy the remaining stake in SABIC, the world’s fourth-largest petrochemicals firm. In addition, the plans of Aramco are to accelerate its refining capacity by 2030, from 4.9 million to 8-10 million barrels per day.
For the record, SABIC and Saudi Aramco have petrochemical production capacity of 62 and 17 million tons a year, respectively.
The long-term growth potential of SABIC is a big part of the 2030 vision which is focused on expanding petchems and now it will run all its future growth plans directly through SABIC, sources mentioned.