Saudi Aramco aims to buy a controlling stake in petrochemical maker SABIC, possibly up to 70% of the company that is currently controlled by the Public Investment Fund (PIF), according to reports.
Sabic, as the chemical company is known, carries a market value of over $100 billion.
Amin Nasser, Aramco’s chief executive officer, said in an interview that the company is still in the early stages of talks and a deal isn’t certain, according to Arabian Business. “A potential Sabic deal would affect the time frame for Saudi Aramco’s initial public offering,” Nasser told Arabiya television in an interview airing Friday.
A stake in a chemical company like Sabic makes Aramco less vulnerable to volatile oil prices, and would be positive for its revenue, Nasser told Al Arabiya.
Sources told Reuters Aramco’s initial thinking is to buy the full stake owned by the Public Investment Fund (PIF), but if that fails to materialize Aramco could end up with a stake in SABIC of more than 50 percent, making it a majority owner, the sources said.
Some of Wall Street’s biggest lenders are offering Aramco loans for the potential deal between the kingdom’s state-owned oil and petrochemical giants, Bloomberg reports, citing unnamed sources.
