Saudi Aramco completes acquisition of stake in SABIC

SAUDI Aramco has announced that it has successfully completed its acquisition of a 70% stake in petrochemical company SABIC.

Aramco purchased the 70% stake from the Public Investment Fund (PIF), the sovereign wealth fund of Saudi Arabia. The purchase price was SAR259.125bn (US$69.1bn) and is part of Aramco’s plans to grow downstream production. Aramco will pay for its stake over the next eight years. The length of the payment schedule will provide some protection against weaker oil prices, according to The Financial Times. The remaining 30% of SABIC will continue to be publicly-traded shares.

The deal will transform Aramco into a major petrochemicals company and allow it to integrate upstream production with SABIC feedstock. The acquisition will also give SABIC the opportunity to invest in and execute major growth projects.  

Amin Nasser, President & CEO, Aramco said: “The strategic integration of our Upstream production and Downstream chemicals feedstock production with SABIC’s chemicals platform is expected to create opportunities for selective integration synergies that support growth and add value for shareholders.”

Abdulaziz Al-Gudaimi, Senior Vice President of Downstream, Aramco said: “As SABIC joins the Aramco family of companies, we expect to create synergies and add value through integration in procurement, supply chain, manufacturing, marketing and sales.”