SABIC sets up company for integration of its agri-nutrient assets
SABIC , the world's third-largest petrochemical company, announced here its decision on Monday to establish a new company called ‘SABIC Agri-nutrient Investments, to consolidate all its equity shares and assets currently held in several companies specialized in the production of various agri-nutrient products.
The decision includes SABIC’s share of assets in Al-Bayroni (Jubail Fertilizer Company) – 50 percent; Ibn Al-Baytar (National Chemical Fertilizer Company) – 50 percent; GPIC (Gulf Petrochemical Industrial Company) – 33.33 percent; MPC (Ma`aden Phosphate Company) – 30 percent and MWSPC (Ma`aden Wa`ad Al-Shamal Phosphate Company) – 15 percent. Additionally SABIC owns 43 percent of SAFCO. The different production companies, manufacture a broad range of fertilizers (agri-nutrients), such as urea, phosphate-based and compound fertilizers. SABIC is currently an anchor shareholder in SAFCO, holding 43 percent of the shares.
Additionally SABIC has signed a Non-binding Memorandum of Understanding (MoU) with its subsidiary SAFCO (Saudi Arabian Fertilizer Company), to facilitate the integration of the newly formed company - SABIC Agri-nutrient Investments - with SAFCO, subject to regulatory and shareholder approval. The integration process is expected to be completed by the end of 2019.
In its new form, the company will benefit from SABIC's strong reputation in the agri-nutrients sector and will serve as a growth platform strengthening SABIC's ambition to grow its agri-nutirients business into a global leading position.
Yousef Al-Benyan, SABIC Vice Chairman and CEO, said, “The integration of our agri-nutrient production assets under one umbrella, represents part of SABIC’s diversification strategy and transformation program to achieve successful and sustainable long-term growth. SABIC has a long and strong track record of growing businesses through joint ventures and co-investment in both listed and private companies. Integration of all our fertilizer production assets will allow SABIC and SAFCO to achieve accelerated organic and inorganic growth as well as capture further operational synergies and increase overall production efficiency.”
SABIC Agri-nutrients Strategic Business Unit and its Marketing, sales and technology and innovation functions will remain part of SABIC delivering the company’s 2025 strategy through its investment arms in this sector.