On Wednesday, we announced the successful completion of our acquisition of a 70% stake in Saudi Basic Industries Corporation (SABIC) — one of the world’s most significant, diversified chemicals companies — from the Public Investment Fund, the sovereign wealth fund of Saudi Arabia. This is Saudi Aramco’s largest transaction in the company’s 87-year history, and I know you will join me in welcoming SABIC and its more than 33,000 employees worldwide into the Saudi Aramco family of companies.
This milestone transaction accelerates our Downstream growth strategy and trans-forms Saudi Aramco into one of the major global petrochemicals players. In 2019, Saudi Aramco and SABIC recorded a petrochemicals production volume of nearly 90 million tonnes combined, so the rationale is very clear. Within our Downstream portfolio, we expect to benefit from SABIC’s complementary petrochemicals capabilities across geographies, projects, and partners. SABIC will benefit from our Upstream production, Downstream chemicals feedstock production, and ability to invest in and execute ma-jor growth projects.
This transaction provides the opportunity to align our strategies and pursue integration synergies in procurement, supply chain, manufacturing, marketing and sales, paving the journey for Saudi Aramco and SABIC to grow together. In addition, and to ensure value creation from synergies, a Corporate Collaboration and Integration Committee has been established, and Saudi Aramco will be able to elect the majority of the directors of SABIC.
With this historic transaction, we will be more agile, resilient, and competitive. In turn, this will enable us to become one of the industry leaders in global petrochemicals — an industry that is expected to record the fastest growth in oil demand in the years ahead. It is an exciting prospect, and we look forward to shaping the future together, while continuing to support Saudi Vision 2030, for the benefit of our customers, our shareholders, and our employees.
Despite the COVID-19 pandemic forcing many companies to rethink or revise their long-term strategy, our long-term focus, financial strength, and resilience have enabled us to complete this historic deal. It marks the beginning of a new chapter in the history of both companies, and is an important marker in delivering our long-term Downstream strategy.
As we continue to address the challenges posed by the COVID-19 pandemic, let’s stay focused on maintaining safe and reliable operations, and meeting our commitments to our stakeholders.
Amin H. Nasser,
President and CEO
— The Arabian Sun: June 18, 2020 | Vol. LXXV, No. 24