SARCO plans to bring legal claim against affiliate over losses

Saudi Arabian Refineries Co. (SARCO) said it will file a legal claim against its affiliate, the Arabian Sulfonates Co. (ASCO), due to the latter’s incurred losses during the first half of 2016, the company said in a statement to Tadawul.

Last February, SARCO was asked by banks to pay a debt guarantee of SAR 5.1 million after ASCO failed to pay off its loans.

SARCO recognized the SAR 5.1 million as credit balance and contingent liability, and recorded the amount as a debt owed by its 34 percent-owned affilliate, Argaam earlier reported.

The company made provisions for SAR 3.8 million in doubtful debt, accounting for 75 percent of ASCO's total dues.

SARCO recorded SAR 920,300 in losses in H1 2016, of which SAR 198,500 were incurred in Q2.