SABIC to establish new company to consolidate agri-nutrient assets

Saudi Basic Industries Corporation (SABIC) will establish a new company, named SABIC Agri-nutrient Investments, to consolidate all its equity shares and assets currently held in several companies specializing in the production of various agri-nutrient products.

The decision includes SABIC’s share of assets in Jubail Fertilizer Company (Al-Bayroni) – 50 percent; National Chemical Fertilizer Company (Ibn Al-Baytar) – 50 percent; Gulf Petrochemical Industrial Company (GPIC) – 33.33 percent; Ma`aden Phosphate Company (MPC) – 30 percent; and Ma`aden Wa`ad Al-Shamal Phosphate Company (MWSPC) – 15 percent.

The new company will benefit from SABIC’s strong reputation in the agri-nutrients sector and will serve as a growth platform strengthening its ambition to grow its agri-nutirients business into a global leading position.

The integration process is expected to be completed by the end of 2019.

“The integration of our agri-nutrient production assets under one umbrella represents part of our diversification strategy and transformation program to achieve successful and sustainable long-term growth. Integration of all our fertilizer production assets will allow us to achieve accelerated organic and inorganic growth as well as capture further operational synergies and increase overall production efficiency,” SABIC Vice Chairman and CEO, Yousef Al-Benyan said.

Additionally SABIC has signed a non-binding Memorandum of Understanding (MoU) with its subsidiary Saudi Arabian Fertilizer Company (SAFCO) to facilitate the integration of the newly formed company, subject to regulatory and shareholder approval.

The petrochemical company also announced in a statement to Tadawul that it will not continue further with the feasibility study for SAFCO’s acquisition of its entire stake in The National Chemical Fertilizer Company (Ibn Al-Baytar) in the light of the integration process.

SABIC is currently an anchor shareholder in SAFCO, holding 43 percent of the shares.