Saudi’s Sabic said to weigh IPO of specialty chemicals business

Saudi’s Sabic said to weigh IPO of specialty chemicals business

Saudi Basic Industries Corporation (Sabic) is considering an initial public offering of its multibillion-dollar specialty chemicals unit, people familiar with the matter said.

Sabic is speaking with advisers as it weighs a potential listing of the business as early as 2021, the people said, asking not to be identified as the matter is private. Specialty chemicals, which Sabic recently carved out as a separate unit, generate about $2 billion of annual revenue, the people said.

Deliberations are at an early stage, and there's no certainty they will lead to a transaction, the people said. Representatives for Sabic and its largest shareholder, Saudi Aramco, declined to comment.

While Sabic hasn't decided on a venue for the potential share sale, a local listing would help Saudi Arabia deepen its stock market at a time when the country has been opening up more to foreign investors. Any deal could also help Sabic raise funds after the company said in May it's suspending new capital expenditures to protect its balance sheet.

Sabic chief executive officer Yousef Al-Benyan

Sabic reported its biggest quarterly loss in at least a decade in the three months through June. It returned to profit in the third quarter, thanks mainly to the reversal of impairments associated with its Clariant