Aramco has signed a definitive agreement to acquire an additional 22.5% stake in Rabigh Refining and Petrochemical Co. (Petro Rabigh) from Sumitomo Chemical for $702 million.
Aramco and Sumitomo Chemical currently each own 37.5% of shares in Petro Rabigh, which was listed on the Saudi Exchange in 2008. Upon completion of the transaction, priced at SAR 7 per share, Aramco will become the largest shareholder in Petro Rabigh with a 60% equity stake, while Sumitomo Chemical will retain a 15% stake. The transaction is subject to customary closing conditions, including regulatory and third-party approvals, and is part of financial measures intended to strengthen Petro Rabigh’s financial position.
Under the terms of the agreement, all proceeds from the sale will be injected into Petro Rabigh through a mechanism to be agreed upon with the company. Aramco will also provide additional funds to Petro Rabigh, matching the $702 million from Sumitomo Chemical, bringing the total financial injection to $1.4 billion.
Additionally, Aramco and Sumitomo Chemical have agreed to a phased waiver of shareholder loans of $750 million each, resulting in a $1.5 billion reduction in Petro Rabigh’s liabilities.
These measures are expected to improve Petro Rabigh’s balance sheet and cash liquidity as part of a plan that Aramco and Sumitomo Chemical are exploring with Petro Rabigh. The plan includes initiatives to upgrade the refinery and improve the profitability of the business. The agreement aligns with Aramco’s downstream expansion and Sumitomo Chemical’s shift toward specialty chemicals.
