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Saudi Aramco signs agreements to restructure Sadara's senior debt financing

Saudi Aramco signs agreements to restructure Sadara's senior debt financing
Saudi Aramco and Dow agreed to provide an around $3.7bn guarantee
SAUDI ARAMCO
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Riyadh – Mubasher: The Saudi Arabian Oil Company (Saudi Aramco) has entered into agreements relating to the restructuring of senior debt financing of Sadara Chemical Company.

Saudi Aramco and The Dow Chemical Company (Dow) have agreed to provide an around $3.7 billion guarantee of senior debt principal in proportion to their ownership interests in Sadara, according to a bourse filing on Monday.

This guarantee is significantly lower than the previous $10 billion shareholder completion guarantees that were disclosed when Sadara achieved project completion in November 2020.

The beneficial terms of the restructuring of Sadara's senior debt financing include a principal repayment grace period until 15 June 2026 and an extension of the final maturity date from 2029 to 2038.

In addition, Saudi Aramco, Dow, and Sadara have signed agreements to offer additional feedstock by raising the quantity of ethane and natural gasoline supplied by Saudi Aramco. 

The agreement also aims to gradually increase Saudi Aramco’s rights in marketing Sadara's finished products, through the Saudi Basic Industries Corporation (SABIC), over the next five years.

Sadara Chemical Company is a related party to Saudi Aramco, which holds 65% of Sadara's share capital.