Aramco has announced its acquisition of an additional 22.5 percent stake in Rabigh Refining and Petrochemical Co. (Petro Rabigh) from Japan’s Sumitomo Chemical for $702 million. This transaction, priced at SR7 ($1.86) per share, will elevate Aramco to the majority shareholder position with a 60 percent stake in the Saudi-based refining and petrochemical complex, while Sumitomo Chemical’s shareholding will be reduced to 15 percent.
Previously, both Aramco and Sumitomo Chemical each held a 37.5 percent stake in Petro Rabigh, which has been publicly traded on the Saudi Exchange since 2008. This acquisition aligns with Aramco’s strategic efforts to enhance its downstream operations, while supporting Sumitomo Chemical’s transition from commodity chemicals to specialty chemicals.
Hussain Al-Qahtani, Aramco’s Senior Vice President of Fuels, emphasized the importance of this move in strengthening Aramco’s downstream value chain and securing the placement of its upstream crude oil with affiliated refineries. Al-Qahtani noted that the increased shareholding is expected to facilitate closer integration with Petro Rabigh and contribute to its turnaround strategy, ultimately improving the company’s balance sheet, liquidity, and profitability.
The transaction is subject to customary closing conditions, including regulatory and third-party approvals. Under the share sale and purchase agreement, the proceeds from Sumitomo Chemical’s sale will be reinvested into Petro Rabigh. Aramco will match Sumitomo’s $702 million investment, resulting in a combined financial injection of $1.4 billion to support Petro Rabigh’s future strategy. Additionally, both companies have agreed to a phased waiver of $750 million each in shareholder loans, reducing Petro Rabigh’s liabilities by $1.5 billion.
Seiji Takeuchi, Senior Managing Executive Officer at Sumitomo Chemical, expressed confidence that the transaction will significantly bolster Petro Rabigh’s financial position, in line with the strategic objectives of both Aramco and Sumitomo Chemical.
