State-owned Saudi Aramco bought 2.1 billion shares of Saudi Basic Industries (SABIC) on the Tadawul, the Kingdom’s stock market, on Sunday, completing its deal to buy 70% of the petrochemical giant, according to a report in Reuters.
According to the report, four transactions were executed on the Saudi exchange involving SABIC shares worth 259,125 billion riyals ($69.1) billion. Four sources confirmed the transactions were part of the Aramco acquisition.
A worker for SABIC in Saudi Arabia.
The shares are being sold by the Public Investment Fund (PIF), providing for a significant increase in cash for investments to deploy toward diversifying the economy away from oil.
Saudi Arabia’s national oil company Saudi Aramco agreed to buy a 70% stake in Saudi Basic Industries Corporation (SABIC), the kingdom’s leading petrochemical firm, for $69.1 billion in a private transaction, SABIC said in a press release in March 2019.
SABIC said the acquisition will be “a key pillar for SABIC and Saudi Aramco in the development of the petrochemicals industry in Saudi Arabia, and reinforces aligned objectives to create a preferred global chemicals company. The transaction will also strengthen Saudi Aramco’s position as one of the world’s largest integrated energy and chemical companies.”
In October, an issue brief written by Jean-François Seznec for the Atlantic Council explored the Saudi Aramco-SABIC merger and Aramco’s strategy to make the Saudi oil giant “like most other large international oil companies, except much bigger.”
