Aramco to pay SR41.25 bln to PIF within two weeks under ‎‎“SABIC” deal‎

The fourth tranch of Saudi Aramco’s acquisition of the Public Investment Fund’s stake in SABIC is due before next April 7, at a value of $10.5 billion, in addition to $500 million financing cost, equivalent to (41.25 billion riyals).

The liquidity entering the Public Investment Fund contributes to the provision of capital that enhances the long-term investment strategy of the Fund, and at the same time leads the economic transformation and growth in Saudi Arabia, in a way that benefits the Kingdom and its economy.

According to the deal, the purchase price paid by Saudi Aramco to acquire the Public Investment Fund’s 70% stake in SABIC is 259.125 billion riyals ($69.1 billion), equivalent to 123.39 riyals per share. The acquisition of an ownership stake in SABIC is in line with Saudi Aramco’s long-term downstream strategy aimed at developing its integrated refining and petrochemical capabilities, and creating value from integration in the hydrocarbon chain.

This specifically supports Saudi Aramco’s strategy in the field of chemicals by transforming Saudi Aramco into one of the world’s largest companies in the petrochemical sector, and integrating the exploration, production, refining and processing sectors with SABIC. It contributes to maximizing the utilization of joint capabilities in the field of supply, supply chain, manufacturing, marketing and sales, enhancing the integration of Saudi Aramco at the geographical level, projects and business partners, and enhancing the ability to achieve cash flows through opportunities for joint cooperation between the two companies.

According to the agreement, the purchase price will be paid through payment orders according to the seller’s loan provided by the Public Investment Fund, as the payment orders are due between August 2, 2020 (which is the first payment) until April 7, 2028 (which is the last payment).

The date of payments according to the deal is as follows:

First: On or before August 2, 2020, an amount equal to $7 billion

Second: On or before April 7, 2021, an amount equal to $5 billion

Third: On or before April 7, 2022, an amount equal to $8.5 billion plus a financing fee of $500 million.

Fourth: On or before April 7, 2023, an amount equal to $10.5 billion plus a financing fee of $500 million.

Fifth: On or before April 7, 2024, an amount equal to $10.5 billion plus a financing fee of $600 million.

Sixth: On or before April 7, 2025, an amount equal to $10.5 billion plus a financing fee of $800 million.

Seventh: On or before April 7, 2026, an amount equal to $17.1 billion plus a financing fee of $1.5 billion.

Eighth: On or before April 7, 2027, financing fees of $1 billion.

Ninth: On or before April 7, 2028, financing fees of $1 billion.