Petro Rabigh signs modified agreements on revolving shareholders loans of Aramco, Sumitomo

Logo of Rabigh Refining and Petrochemical Co. (Petro Rabigh)

Rabigh Refining and Petrochemical Co. (Petro Rabigh) signed, on Aug. 28, modified agreements on revolving shareholders loans (RSLs) provided by its founding shareholders, Saudi Aramco and Sumitomo Chemical Co., which were previously announced by Petro Rabigh on Oct. 1, 2020.

Under these agreements, the founding shareholders have irrevocably and unconditionally waived Petro Rabigh’s obligation to pay $1 billion (SAR 3.75 billion) of the aggregate amount of RSLs outstanding [or $500 million (SAR 1.87 billion) under each RSL], plus any related commission, the company said in a statement to Tadawul.

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These deals are deemed as related-party agreements, with Aramco and Sumitomo holding 37.5% each of Petro Rabigh.

The debt waiver is expected positively impact the company’s financial position, which will be disclosed later.

Petro Rabigh affirmed that the new agreement reached underlined the founding shareholders’ support for the company’s financial position and transformation strategy.

Earlier this month, Aramco signed a binding agreement to acquire an additional stake of approximately 22.5% in Petro Rabigh from Sumitomo for $702 million, Argaam reported.