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Sources: Aramco Discusses Deal Worth Over $10 bln

Sources: Aramco Discusses Deal Worth Over $10 bln

Wednesday, 14 October, 2020 - 04:15
FILE PHOTO: Saudi Aramco logo is pictured at the oil facility in Abqaiq, Saudi Arabia October 12, 2019. REUTERS/Maxim Shemetov/File Photo

Saudi Aramco is in talks with BlackRock and other investors on a planned deal worth over $10 billion to sell a stake in its pipeline business, sources said.


The deal is still in its initial phase and there is no formal decision on the investors yet, one of the two sources familiar with the matter told Reuters.


The transaction would be similar to infrastructure deals signed this and last year by Abu Dhabi's national oil company ADNOC.


Those raised billions of dollars by leasing its oil and gas pipelines assets to investor partners.


The deal would provide Aramco with cash at a time of low oil prices caused by the coronavirus crisis.


"There's more work to be done. No buyers have been lined up, but there are talks," said the first source.


Another source familiar with the matter said Brookfield Asset Management was also involved in the discussions.


JPMorgan and Japan's MUFG have been hired to advise the company on the deal, sources have previously told Reuters.


Talks are continuing regarding the type of financing investors would raise to back their acquisition, the first source said, adding it could involve a syndicated loan and a bond issuance linked to revenue from the assets.


BlackRock, the world's biggest asset manager, along with buyout firm KKR & Co, last year bought a 40% stake in ADNOC Oil Pipelines for $4 billion.


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