By OGJ editors
HOUSTON, May 21 -- Saudi Basic Industries Corp. (SABIC), Riyadh, signed a 2.4 billion euro loan agreement with local, regional, and international banks to fund its proposed acquisition of DSM Petrochemicals (DPC).
SABIC earlier reached an agreement in principle with DSM NV in Geleen, the Netherlands, to purchase DSM's petrochemicals business for 2.25 billion euros ($1.98 billion). In anticipation of that sale, four DSM chemical businesses in the Netherlands and two in the US were merged Jan. 1, 2001, to form DPC (OGJ Online, Apr. 3, 2002).
Following that acquisition, SABIC—already the largest petrochemicals producer in the Middle East—will become 11th largest in the global petrochemicals industry, up from 22nd at present. It also will become, respectively, the third and fourth largest global player in the polyethylene and polypropylene businesses.
The loan package includes one loan of 408 million euros for SABIC Europe, one for 1.125 billion euros guaranteed by SABIC Luxembourg, and one for 820 million euros in favor of DPC. Half of the purchase price is to be paid upon the expected June 30 closing, with the remainder due in another 4.5 years.
In 2001 DSM Petrochemicals generated sales of 2.4 billion euros. It annually sells about 2.6 million tonnes of polymers, mainly in Europe.
