Saudi Basic Industries Corp. — M&A Activity 2018

Sep 18, 2018

Saudi Basic Industries Corporation (SABIC) announces the signing of a memorandum of understanding with Clariant AG

2010 · 18/09/2018 08:36:14 · Announcement #52126 · View on Saudi Exchange

Saudi Basic Industries Corporation (SABIC) announces the signing of a memorandum of understanding with Clariant AG

Saudi Basic Industries Corporation (SABIC) announces the signing of a Memorandum of Understanding (MoU) with Swiss company Clariant AG on Monday evening, 17th September 2018. The Memorandum sets out key principles of cooperation between the two parties to establish a new business for the production of (High Performance Materials), a sector will be an exceptional source of global growth in Specialties business. The duration of the MoU is nine months, ending in June 2019.

If the two parties agree on the set of key principles of cooperation stipulated in the Memorandum of Understanding, parts of SABIC Specialties business (comprising its unique ULTEM and NORYL resins, and its families of LNP compounds and copolymers) would be merged with Clariant additives and high value masterbatch offerings, as part of the Clariant group. The intended transaction is anticipated to be signed during 2019 and to implement it at the beginning of 2020.

Following completion of the intended transaction, Clariant would form a new (High Performance Materials) business incorporating the combined products of both companies to achieve the competitive advantage of that business. In addition to realizing cost synergies and operating efficiencies.

The move is part of SABIC strategy to explore new growth opportunities in specialties business. It is also in line with its strategy of creating a world-class specialty company that brings added value to shareholders, customers and employees.

It is worth noting that SABIC currently has no plans to launch or otherwise effect a full takeover of Clariant AG. The intended transaction above are subject to obtaining the required regulatory approvals.

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