SABIC is one of the world’s biggest petrcochemicals firms ()

Riyadh (AFP) – Saudi state oil giant Aramco said Wednesday it is buying a 70 percent stake in petrochemicals behemoth SABIC, in a deal worth $69.1 billion.

“Saudi Aramco today announced the signing of a share purchase agreement to acquire a 70% majority stake in Saudi Basic Industries Corporation (SABIC) from the Public Investment Fund of Saudi Arabia, in a private transaction for… $69.1 billion,” Aramco said in a statement.

Saudi Arabia had sought to raise billions of dollars through a historic Aramco public offer to diversify its oil-dependent economy, but the plan has suffered a series of delays.

Observers see the acquisition of a controlling stake in SABIC as a complex alternative to raise much-needed cash for the Public Investment Fund (PIF), the kingdom’s top sovereign wealth fund.

“This is a win-win-win transaction and  a transformational deal for three of Saudi Arabia’s most important economic entities,” PIF managing director Yasir al-Rumayyan said in the Aramco statement.

“It will unlock significant capital for PIF’s continued long-term investment strategy, underpinning sectoral and revenue diversification for Saudi Arabia.”

SABIC, Saudi Arabia’s largest publicly listed company, is said to have a market capitalisation of around $100 billion — the same amount the kingdom had sought to raise from Aramco’s IPO.

The PIF, which hopes to control more than $2 trillion by 2030, is involved in a host of big-ticket global investments, buying a stake in Uber and pumping cash into a planned $500 billion mega city in the kingdom’s northwest.

It seeks cash to finance an ambitious reform programme envisaged by Crown Prince Mohammed bin Salman to wean the economy off its reliance on oil.

Disclaimer: This story is published from a syndicated feed. Siliconeer does not assume any liability for the above story. Validity of the above story is for 7 Days from original date of publishing. Content copyright AFP.