SABIC Completes Sale of Stake in Saudi Iron and Steel Company to PIF

SABIC, the Saudi Basic Industries Corporation, has announced the complete sale of its stake in Saudi Iron and Steel Company (Hadeed) to the Public Investment Fund (PIF) for a total value of SAR 12.5 billion.

In a statement published on the Saudi Stock Exchange's website, SABIC stated, "Due to the transaction being conducted according to what is known as the 'transaction completion accounts' mechanism, the final sale price will only be determined on the date of transaction completion, expected to be before the end of the first quarter of 2024, and will be announced later."

Hadeed is engaged in the manufacturing of steel products, including reinforcing bars, wire rods, iron bars, plates, steel sections, hot-rolled and cold-rolled pipes, galvanized pipes, printed pipes, and film-coated pipes.

SABIC mentioned that the transaction would enable the company to focus on its core business and improve it. The proceeds will be utilized to enhance SABIC's growth in the chemical sector.

As per the terms of the agreements, Hadeed will simultaneously acquire shares of Hadeed Al-Rajhi Steel Company (Hadeed Al-Rajhi) by 100% from Mohammed Abdulaziz Al-Rajhi & Sons for Investment (Al-Rajhi for Investment), through a capital increase and subscription for new shares in Hadeed.

The completion of the transactions is subject to fulfilling conditions and obtaining official approvals from relevant authorities. The ownership percentages of both PIF and Al-Rajhi for Investment in Hadeed will be determined in accordance with the mechanisms mentioned in the relevant agreements.

The transactions will support the efforts of the Public Investment Fund in contributing to the development of the local industry and meeting the increasing domestic demand for iron products in the construction, automotive, utilities, renewable energy, transportation, and logistics sectors, in line with the objectives of Saudi Vision 2030.

The transactions will bring together the high-quality facilities of Hadeed and Hadeed Al-Rajhi, in addition to leveraging their managerial capabilities, technical expertise, and commercial experience in the steel sector in the Kingdom. This will contribute to increasing production capacity and operational efficiency.

Yazeed bin Abdulrahman Al-Hamid, Deputy Governor of the Public Investment Fund, states, "The transactions will combine the financial capabilities and investment expertise of the Fund in the sector with the technical and commercial expertise of Hadeed Al-Rajhi and Hadeed, contributing to the development of a national leadership system in the steel sector. It also aligns with the Fund's role in creating strategic partnerships that empower the private sector."

Abdulrahman Saleh Al-Fageeh, CEO of SABIC, said, "We recognize that the company has great potential to become one of the leading steel companies in the Gulf Cooperation Council countries. Therefore, it was important for us to complete the appropriate transaction to enable the company to unleash its full potential. At the same time, this transaction will enable SABIC to focus on its strategy of becoming the preferred global leader in the chemical industry."

 

مواضيع مرتبطة
التعليقات
or

For faster login or register use your social account.

Connect with Facebook