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    2010   SA0007879121

SAUDI BASIC INDUSTRIES CORPORATION

(2010)
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Saudi Aramco's board to meet to approve SABIC bond plan - sources

03/11/2019 | 06:06am EDT
FILE PHOTO: An Aramco oil tank is seen at the Production facility at Saudi Aramco's Shaybah oilfield in the Empty Quarter

DUBAI/LONDON (Reuters) - Saudi Aramco's board is set to meet this week in Saudi Arabia where it will approve a bond issuance plan that could help finance the potential acquisition of a stake in Saudi petrochemicals maker SABIC, industry sources said.

Aramco, the world's top oil producer, plans to issue its first international bonds in the second quarter of 2019 and the issuance will probably be around $10 billion (7.7 billion pounds)

, Saudi Energy Minister Khalid al-Falih has said.

The company's representatives are expected to meet fixed-income investors in a bond roadshow in April, two sources familiar with the matter said.

The deal is expected to involve the purchase of all, or nearly all, of the 70 percent stake in SABIC held by the Public Investment Fund, the kingdom's top sovereign wealth fund. That implies a deal value of roughly $70 billion, though the acquisition price has not been made public yet.

The Aramco board of director will also approve the 2018 financial results for the company, which is likely to be included in the bond prospectus along with the firm's oil and gas reserves.

"The board will approve the bonds. SABIC (deal) is progressing but any project of this size takes a long time," said one of the sources.

Aramco declined to comment.

Senior Aramco officials have travelled to the United States and Britain in recent weeks to gauge investor appetite for the planned bond, the sources said.

Aramco had already picked a group of banks including Goldman Sachs, JPMorgan, Morgan Stanley, Citi, HSBC and Saudi Arabia's National Commercial Bank to help arrange the planned bonds.

When Aramco approached banks formally for the bonds sale earlier this year, it asked them to submit proposals for the bonds and potential commitments for bank debt financing, banking sources said.

The sources said the acquisition payment is likely to be staggered, allowing Aramco to tap debt investors in various phases - a move which would avoid straining banks that are not ready to commit large sums through a single loan facility.

Banks have pitched hard over the past months for this high-profile bond mandate, hoping to be rewarded by Aramco with future mandates for capital markets transactions and other banking business.

JP Morgan and Morgan Stanley, along with other banks, were working on the planned stock market listing of Aramco before the move was put on hold due to the SABIC acquisition. The new planned listing date is 2021, Saudi officials said.

An international bond sale by Aramco will almost certainly require the company to obtain a credit rating and disclose financial information in a prospectus.

Aramco has already started talking to rating agencies, and although the state oil giant aims to match the ratings of Big Oil companies such as Exxon Mobil and Shell, bond market investors expect Aramco to not have a higher rating than Saudi Arabia.

(Reporting by Rania El Gamal and Davide Barbuscia in Dubai, Dmitry Zhdannikov, Alex Lawler, Tom Arnold in London; Editing by Sam Holmes and Louise Heavens)

By Rania El Gamal, Davide Barbuscia and Alex Lawler


ę Reuters 2019
Stocks mentioned in the article
ChangeLast1st jan.
BYD COMPANY LIMITED 0.31% 259 End-of-day quote.27.46%
EXXON MOBIL CORPORATION 0.63% 57.9145 Delayed Quote.39.67%
HSBC HOLDINGS PLC 0.53% 398.05 Delayed Quote.4.57%
MORGAN STANLEY 0.23% 96.47 Delayed Quote.40.06%
SAUDI ARABIAN OIL COMPANY 0.00% 34.95 End-of-day quote.-0.14%
SAUDI BASIC INDUSTRIES CORPORATION 0.33% 122.8 End-of-day quote.21.10%
THE GOLDMAN SACHS GROUP, INC. 0.30% 379.32 Delayed Quote.43.41%
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Financials
Sales 2021 155 B 41 303 M 41 303 M
Net income 2021 17 675 M 4 713 M 4 713 M
Net Debt 2021 2 116 M 564 M 564 M
P/E ratio 2021 20,0x
Yield 2021 2,96%
Capitalization 368 B 98 240 M 98 243 M
EV / Sales 2021 2,39x
EV / Sales 2022 2,37x
Nbr of Employees 35 000
Free-Float 30,0%
Chart SAUDI BASIC INDUSTRIES CORPORATION
Duration : Period :
Saudi Basic Industries Corporation Technical Analysis Chart | 2010 | SA0007879121 | MarketScreener
Technical analysis trends SAUDI BASIC INDUSTRIES CORPORATION
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus UNDERPERFORM
Number of Analysts 12
Last Close Price 122,80 SAR
Average target price 112,77 SAR
Spread / Average Target -8,17%
EPS Revisions
Managers and Directors
Yousef bin Abdullah Al-Benyan Vice Chairman & Chief Executive Officer
Timothy D. Leveille Executive Vice President-Corporate Finance
Khalid Hashim Al-Dabbagh Chairman
Bob Maughon Executive Vice President-Technology & Innovation
Khaled Hamza Nahas Independent Director
Sector and Competitors