https://arab.news/rhqz9
- SABIC said move in line with its portfolio optimization and core business focus strategy
- Study remains ongoing, with each option subject to necessary assessments
DUBAI: Saudi chemicals group SABIC said on Wednesday it was studying strategic options for its National Industrial Gases Company, including an initial public offering, amid a broad review of its business.
SABIC said in a statement that the move was in line with its portfolio optimization and core business focus strategy, adding that an IPO of GAS would be aimed at improving the group’s “financial position and the value added for shareholders.”
The chemicals industry has been grappling with weak demand and high input costs, leading to lower prices and squeezed margins.
SABIC, one of the world’s largest petrochemical companies and 70 percent-owned by oil major Saudi Aramco, reported in May a first-quarter net loss of $323 million, citing a rise in operating costs and high feedstock costs.
Earlier this year, it also said it planned to cut costs and find new investment opportunities, while restructuring some core assets and offloading non-core businesses.
It has already divested its stakes in Aluminium Bahrain, or Alba, and steel business Hadeed, selling both to other state-backed Saudi entities.
SABIC said on Wednesday that “the study remains ongoing, with each option subject to the necessary financial, technical, regulatory and economic assessments.”
Its shares have fallen 16.3 percent since the beginning of the year, according to LSEG data.