SABIC to divest of steel producer for $3.33 bln

RIYADH, September 4, 2023 – Saudi Arabian chemicals giant SABIC has agreed to sell its steel subsidiary Saudi Iron and Steel Company (Hadeed) to sovereign wealth fund Public Investment Fund (PIF) for around USD 3.33 billion, Reuters reported on Sunday.

Under the deal, Hadeed will also fully acquire Al-Rajhi Steel Industries Company or Rajhi Steel from Mohammed Abdulaziz AlRajhi & Sons Investment Company in exchange for shares in Hadeed.

The transaction is expected to close by the end of Q4 2024, with the exact cost disclosed at a later date.

“The sale of Hadeed will enable SABIC to focus meanwhile on its strategy to become the preferred world leader in chemicals,” said Abdulrahman Al-Fageeh, CEO of SABIC.

PIF is spearheading Saudi Arabia’s Vision 2040 initiative that is focused on upping local manufacturing capabilities.

“The steel industry is foundational to the Saudi economy and its diversification and growth,” said Yazeed A. Al-Humied, deputy governor and head of Middle East and North Africa investments at PIF.

“These transactions will bring together PIF’s financial capabilities and industry experience with Hadeed and Rajhi Steel’s leading technical and commercial expertise to create a national champion in Saudi Arabia’s steel sector.”

Read our latest insights on: