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Saudi Aramco Picks Up $69 Billion Majority Stake In SABIC

Mary Sophia
Saudi Aramco Picks Up $69 Billion Majority Stake In SABICCredit: Saudi Aramco

Oil giant Saudi Aramco has announced that it has acquired a 70% stake in petrochemicals firm Saudi Basic Industries Corporation (SABIC) for a sum of $69.1 billion. The deal would reportedly provide a major boost to its Vision 2030 program.

An acquisition of shares in SABIC comes after the Kingdom announced that it would push back a planned IPO of Aramco. The proceeds from the sale of Aramco were to help the government undertake an economic program that would diversify the oil-reliant economy. But the officials had said that it could raise the same level of funds through acquiring a stake in SABIC.

Aramco said that it has no plans to acquire the remaining 30% of shares of SABIC, which are publicly traded.

“This is a win-win-win transaction and a transformational deal for three of Saudi Arabia’s most important economic entities,” says Yasir Othman Al-Rumayyan, Managing Director, Public Investment Fund of Saudi Arabia.

“Furthermore, it will introduce a strategic owner that can add considerable value to SABIC and all its shareholders, while capitalizing on SABIC’s strong capabilities to unlock the opportunities for growth that Saudi Aramco, a key player in energy markets around the world, can offer.”

The company did not say how the deal would be financed though.

A deal with SABIC would also help consolidate the companies’ ambition to become leaders within the downstream industry.

“This transaction is a major step in accelerating Saudi Aramco’s transformative downstream growth strategy of integrated refining and petrochemicals,” says Amin Nasser, President & CEO, Saudi Aramco.

As part of its downstream strategy, Aramco plans to increase global participated refining capacity from 4.9 million to 8 to10 million barrels per day by 2030, of which 2 to 3 million barrels per day will be converted into petrochemical products. 

At Forbes Middle East, I write about some of the most successful entrepreneurs and companies that are shaping the regional economies. I’ve covered industries such as banking, technology, real estate, healthcare, aviation and travel during my time at Forbes Middle East. A seasoned journalist with an extensive experience in business reporting, I’ve interviewed cabinet ministers and CEOs to get the inside scoop. A long-term resident of the UAE, I have previously worked as a reporter for Gulf Business and have interned at The National and BBC News Middle East.

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