Saudi Aramco to turn to bonds to help fund $75bn dividend

SourceArabian Business
SectorFinancial Markets
CountrySaudi Arabia

Saudi Aramco, the world’s biggest oil company, is set to return to the bond markets for the first time since April of last year as it seeks to fund a $75 billion dividend commitment. The company, which hired banks including Goldman Sachs Group Inc.

for the bond sale, needs to raise debt after slumping crude prices caused profit to fall by 45 percent in the third quarter. That’s left it unable to generate enough cash to fund the investor payouts, most of which go to the Saudi government, which needs the money to plug a widening budget deficit. Aramco has slashed spending, cut jobs, and is considering selling some assets. Despite these efforts to conserve cash, its gearing - a measure of debt as a percentage of equity - has risen to 21.8 more...