Saudi Aramco plans restructuring SABIC stake deal: sources

Saudi Aramco is planning to restructure its deal to acquire a controlling stake in petrochemicals maker Saudi Basic Industries Corp (SABIC), Reuters reported, citing 2 sources.

The move comes after a more than 40% drop in SABIC’s value following a slump in oil prices during the coronavirus pandemic.

The sources indicated that Aramco’s chairman and head of the Public Investment Fund (PIF), Yasir Al-Rumayyan, is leading the talks for the oil giant and purchase price will be reviewed.

Saudi Aramco wanted to reduce the burden on its balance sheet, the sources added.

In March 2019, Saudi Aramco signed a share purchase agreement to acquire a 70% majority stake in SABIC from the PIF, Argaam reported.

In October 2019, the company agreed with the PIF to pay 36% of the deal value in cash upon the close of the deal, and the remaining 64% to be settled in the form a loan arranged by the seller.

The transaction was priced at SAR 123.39 per SABIC share, when the deal was announced in March 2019, but its shares are currently trading at around SAR 72.90.