Saudi Aramco closes deal to become largest shareholder in Petro Rabigh
Saudi Aramco completed a deal to acquire an additional 22.5% stake in Rabigh Refining and Petrochemical Co. (Petro Rabigh) from Sumitomo Chemical Corp. for $702 million.
Through the deal, which advances Aramco’s downstream expansion plans, the company is now Petro Rabigh’s largest shareholder with an equity stake of about 60%, the company said in a release Oct. 9. Sumitomo retains an equity stake of 15%.
Petro Rabigh is operator of an integrated refining and petrochemical complex in the port city of Rabigh, Saudi Arabia, along the Red Sea.
Petro Rabigh is currently undergoing a transformation program, which includes “targeted asset upgrades to improve the yield of high-margin products and enhance plant reliability,” Aramco said.
As part of the deal, first reported in August 2024, Aramco and Sumitomo agreed to inject a total of $1.4 billion to partly prepay Petro Rabigh’s debt, supporting its future growth opportunities and strengthening its balance sheet.
This injection will involve the issuance by Petro Rabigh of Class B shares, which will be fully subscribed to by Aramco and Sumitomo. Through the issuance, Aramco and Sumitomo will be able to inject capital without altering Petro Rabigh’s existing governance structure or diluting the voting power of Petro Rabigh’s other shareholders.
As part of the transaction, Aramco and Sumitomo have also waived a total of $1.5 billion in shareholder loans to Petro Rabigh. aimed at improving capital structure and partially remediating accumulated losses, Aramco said.