Saudi Aramco hires HSBC, Japan's SMBC for $10 bln loan: sources

Saudi Aramco picked HSBC and Japan’s Sumitomo Mitsui Banking Corporation (SMBC) to coordinate talks with other banks for a $10 billion loan, Reuters reported on Wednesday, citing unnamed sources.

Reuters recently reported that the world’s largest oil producer was in early talks with banks for a loan of about $10 billion to help finance its acquisition of a 70% stake in Saudi Basic Industries Corp (SABIC).

On March 27, 2019, Saudi Aramco signed an agreement to buy the Public Investment Fund’s (PIF) stake in SABIC for $69.1 billion.

Aramco agreed with the sovereign wealth fund to pay 36% of the deal value in cash, while the remaining 64% will be settled in the form a loan arranged by the seller.

Aramco did not comment on the choice of the banks but said it continues to review financial options “as part of its normal course of business, while prudently preserving its pristine balance sheet and resilience”.

HSBC declined to comment while SMBC could not be immediately reached.