Chemanol Signs Two Financing Agreements worth SR695 mln with Saudi Fransi and Alinma

Methanol Chemicals Company (Chemanol) announced on Wednesday the signing of two Sharia-compliant Murabaha financing agreements with Banque Saudi Fransi and Alinma Bank with financing amount SR 695 mln.

The first Murabaha financing agreement amounts to SR 455 million which is going to be used to settle all existing loans with better terms and lower finance cost, while the second Murabaha financing agreement amounts to SR 240 million and will be used to finance Methanol plant expansion project.

The second Murabaha financing agreement will contribute to the completion of the methanol plant expansion project, which is the mainstay of the company’s future projects announced previously on March 02, 2020, and this project will mainly lead to sustainable profitability and reduce production costs for all of the company’s products.

The financing entity is Banque Saudi Fransi and Alinma Bank SR 695 Million The objective of obtaining the financing of SR 455 million is to support the financial position of the company and settle all existing loans to reduce the finance costs, as new financing has been obtained at competitive costs and terms, which is expected to have a positive financial impact on the company through significant finance cost savings as compared to the previous financing arrangement.

The objective of the financing of SR 240 million is to complete the Methanol expansion project which will increase the production capacity as well as improve profitability of the Company, in accordance with what, which was announced on January 24, 2022.