Oil & Gas Innovation Summer 2020 Digital | Page 54
PROCESSING
Aramco completes its acquisition of a 70%
stake in SABIC from the Public Investment
Fund (PIF)
Aramco today announced the successful completion of its share acquisition of a 70% stake in Saudi Basic
Industries Corporation (SABIC) from the Public Investment Fund (PIF), the sovereign wealth fund
of Saudi Arabia, for a total purchase price of SAR 259.125 billion (US$ 69.1 billion), equating to SAR
123.39 price per share.
The completion of the transaction
enhances Aramco’s presence in the global
petrochemicals industry, a sector expected to
record the fastest growth in oil demand in the
years ahead. Combined, in 2019 Aramco and
SABIC recorded petrochemicals production
volume of nearly 90 million tonnes, including
agri-nutrient and specialty products.
The acquisition of the SABIC stake is consistent
with Aramco’s long-term Downstream
strategy to grow its integrated refining and
petrochemicals capacity and create value from
integration across the hydrocarbon chain.
It specifically enhances Aramco’s chemicals
strategy by transforming Aramco into one of the
major global petrochemicals players; integrating
upstream production with SABIC feedstock;
expanding capabilities in procurement, supply
chain, manufacturing, marketing and sales;
complementing geographic presence, projects
and partners; and increasing the resilience of cash
flow generation with synergistic opportunities.
SABIC expects also to benefit from Aramco’s
Downstream chemicals feedstock production,
and ability to invest in and execute major growth
projects at a very large scale.
H.E. Yasir Othman Al-Rumayyan, Governor,
Public Investment Fund (PIF) said: “This is a
significant milestone for three of Saudi Arabia’s
most important entities. It provides capital for
PIF’s long-term investment strategy as it drives
the economic transformation and growth of
Saudi Arabia, further benefitting the people of
our country; it supports Aramco’s continued
growth in Downstream and enhances
its international footprint; and, it provides
SABIC a new strategic energy industry
focused shareholder with the ability to
support growth projects.”
Amin Nasser, President & CEO, Aramco
said: “We are excited to complete this
transaction. It is a significant leap forward
which accelerates Aramco’s Downstream
strategy and transforms our company into one
of the major global petrochemicals players.
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.”
“Despite the COVID-19 pandemic forcing
many companies to rethink or revise their
long term strategies, our long-term focus,
financial strength and resilience have enabled
us to complete this historic deal. It marks the
beginning of a new chapter in the history of
both companies and is an important marker
in delivering our long term Downstream
strategy.”
Abdulaziz Al-Gudaimi, Senior Vice President
of Downstream, Aramco said: “The completion
of this transaction marks an important step in
Aramco’s continuous drive to develop a global
integrated Downstream business designed to
add value across the hydrocarbon chain. 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.”
Yousef A. Al-Benyan, Vice Chairman and
CEO, SABIC said: “SABIC’s relationship
with PIF and Aramco goes back to our
inception in 1976. SABIC is grateful to His
Excellency Yasir Al-Rumayyan for the strong
and constant support we have received from
both him and PIF. The global scale and
presence of SABIC, one of the world’s most
significant diversified chemicals companies,
brings significant enhancements to Aramco.
As the chemicals growth platform, SABIC
expects to benefit from the additional scale,
technology, investment potential, and growth
opportunities Aramco will bring in integrated
energy and chemicals production. We look
forward to contributing to global chemicals
growth, while continuing to support Saudi
Vision 2030.”
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