US-based Dow Chemical Co. and Saudi Arabian Oil Co. (Saudi Aramco) have signed a memorandum of understanding to allow Dow to acquire an additional 15 percent ownership from Aramco in their joint venture firm Sadara Chemical Co. (Sadara), the two oil firms said in a joint statement on Monday.
Currently, Dow owns a 35 percent stake in the $20 billion joint venture. Once the transaction is complete, Dow and Aramco will be 50-50 partners in Sadara.
The deal is expected after the separation of Materials Science Co. within 18 months after the merger of equals between Dow and DuPont on August 31; and after Sadara’s completion of a creditors’ reliability test, which is part of the limited-recourse financing used to fund the construction of the complex.
The expected financial impact of the potential deal was not disclosed.
The Sadara chemical complex has 26 integrated facilities, with the capacity to manufacture more than 3 million tonnes of products every year.
Earlier this month, Sadara said that it had commissioned the last plant at its Jubail chemical complex, and all 26 manufacturing plants are ready to start operations.
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