Saudi Petrochem, SIIG commence talks on proposed merger

Saudi Arabia's National Petrochemical Company (Petrochem) and Saudi Industrial Investment Group (SIIG) have completed initial economic feasibility studies for their proposed merger, first announced in September 2020.

The companies will now move to negotiate the terms and conditions of the proposed transaction and hope to propose a deal to their respective shareholder for approval by the end of 2021.

SIIG already controls a 50pc stake in Petrochem. A merger would create a company with around $9.4bn in assets.

Petrochem has two subsidiaries, Saudi Polymers and Gulf Polymers Distribution, both of which are 65pc owned by Petrochem. Saudi Polymers' plants in Jubail can produce up to 1.2mn t/yr of ethylene and 440,000 t/yr of propylene. It also produces polyethylene, polypropylene, polystyrene and 1-Hexene, which are distributed by Gulf Polymers Distribution.

By Sam Hashmi