• Friday, March 29, 2024
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BusinessDay

Saudi Aramco to acquire Sabic, enters bond market for $10bn

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State owned Saudi Aramco is moving to acquire stakes in petrochemicals giant Sabic Industries Corp. and could enter the bond market to raise $10 billion to help actualise this acquisition.

This is according to Khalid Al-Falih, Saudi Arabia’s Energy Minister. In this light, the kingdom will decide in the coming weeks about the size of the proposed bond, huge offerings are not expected, Al-Falih told reporters in Abu Dhabi. “It will be probably in about the $10 billion range.”

Bloomberg reported that Aramco plans to tap the market in the second quarter, selling its first international bond and forcing the world’s largest oil producer to disclose its accounts to investors for the first time since its nationalisation roughly four decades ago. It may also have to make public details about oil reserves and operations.

Aramco is negotiating to buy 70 percent of Sabic from the Public Investment Fund, which could cost about $70 billion. Some had expected the potential bond to rank among the largest issued by a company if Aramco planned to finance a large chunk of the Sabic deal with it, though Al-Falih last week played down chatter in the market that Aramco would fund the entire deal with the bond offering.