Aramco CEO: We aim to raise borrowing to finance growth

Saudi Aramco CEO Amin Nasser said that Aramco is aiming to raise borrowing to finance growth and strengthen its balance sheet, after the company raised $5 billion in bonds this week. “Our debt ratio today is around 5%, which is still one of the lowest in the industry,” Nasser said in an interview with Bloomberg TV.

Aramco needs financing to bridge the financial gap, as the decline in free cash flow amid lower oil prices is not enough to cover the massive dividend payout, even after the reduction in payments. This has raised the company’s net debt to its highest level in about three years and pushed borrowing ratios higher, but they remain significantly lower than some other major oil companies.

The bond sale, along with the $9 billion raised last year, helps mitigate the impact of lower oil prices on the company’s finances.

It is worth noting that Saudi Aramco announced last Tuesday the issuance of dollar-denominated international bonds under its International Medium-Term Note (IMTN) program, starting May 27 and ending June 2.

According to the company’s statement on Tadawul, the offering value will be determined based on market conditions, while the target group is institutional investors (qualified in the countries where the offering will take place, in accordance with the laws and regulations in force in those countries).

The minimum amount will be The subscription is $200,000 and in multiples of $1,000 in excess of that amount, subject to market conditions.