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SABIC Reshapes Global Footprint With $950m Divestment Deals

A SABIC employee (company website) 
A SABIC employee (company website) 
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SABIC Reshapes Global Footprint With $950m Divestment Deals

A SABIC employee (company website) 
A SABIC employee (company website) 

Saudi Basic Industries Corporation (SABIC) has announced a major overhaul of its global portfolio, accelerating its exit from petrochemical and engineering plastics assets in Europe and the Americas through two divestment deals worth a combined $950 million.

The move marks a fundamental shift in the company’s operating model and investment identity. It comes as part of an intensive portfolio-optimization program launched in 2022, aimed at boosting returns on capital, freeing up cash, and refocusing investments on higher-growth markets and more sustainable profit margins.

Following the announcement, SABIC shares came under heavy selling pressure on Thursday, falling to 48.78 riyals — their lowest level since April 2009. The decline reflected investor reaction to deal details that include non-cash losses of about $4.88 billion (18.3 billion riyals), stemming from the fair-value revaluation of divested assets. These charges are expected to weigh on the company’s fourth-quarter 2025 results.

While the market response was cautious, analysts say the accounting hit represents a necessary short-term sacrifice to build a leaner, more competitive company aligned with the new centers of global economic growth in East Asia. The divestments also fit within SABIC’s longer-term strategic shift that began in 2020, when Saudi Aramco acquired a 70% stake in the company from the Public Investment Fund for $69.1 billion in the largest deal in the history of the Saudi stock market.

Focus on Higher-Margin Markets

According to SABIC, the first transaction involves the sale of its European petrochemicals business to investment firm AEQUITA for an enterprise value of $500 million. The second covers the sale of its thermoplastics engineering plastics business in Europe and the Americas to Mutares SE & Co. KGaA for $450 million, with potential additional payments linked to future free cash flow over the next four years or a subsequent resale of the business.

SABIC said the transactions represent a key step in reshaping its portfolio, sharpening its focus on higher-margin markets and products with strong competitive advantages, while redeploying capital into opportunities that deliver stronger returns and improved free cash flow. The company stressed that the divestments will not detract from its commitment to technology and innovation or its ability to serve customers worldwide.

Short-Term Pain, Long-Term Gain

SABIC chairman Khalid Al-Dabbagh described the deals as a “transformational step” in the company’s strategy to maximize shareholder value by strengthening cash generation.

Chief executive Abdulrahman Al-Fageeh said the transactions extend the portfolio-optimization program launched in 2022, which included earlier exits from functional forms and the Hadeed and Alba businesses. He said the strategy allows SABIC to reshape its portfolio more effectively and concentrate on areas where it has clear and sustainable competitive advantages in a rapidly changing global environment.

For his part, Chief financial officer Salah Al-Hareky added that the divestments reflect SABIC’s disciplined approach to capital management. Freeing up capital for redeployment into higher-return opportunities, he said, will improve capital efficiency and enhance returns over the medium to long term.

Assets Involved

The European petrochemicals business being sold includes the production and marketing of ethylene, propylene, polyethylene, polypropylene and value-added polymer compounds, with manufacturing sites in the UK, the Netherlands, Germany and Belgium.

The engineering thermoplastics deal covers SABIC assets producing materials such as polycarbonate, polybutylene terephthalate and ABS resins, with manufacturing facilities in the United States, Mexico, Brazil, Spain and the Netherlands. Mutares co-founder and chief executive Robin Laik said the priority after completion will be ensuring business continuity and supporting employees during the transition, while unlocking the full potential of the assets as a standalone platform.

Completion of both transactions remains subject to customary conditions and regulatory approvals, including employee consultations where required. SABIC expects the deals to close in the second half of 2026.

Analysts see the exits from lower-return assets as a catalyst for improved margins and stronger free cash flow, positioning SABIC for a more resilient and profitable phase beyond the near-term pressures on its share price.

 

 

 

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Business

Yanbu Commercial Port Boosts Operational Efficiency by Serving 11 Vessels Simultaneously

The accomplishment builds on the vital role of Yanbu Commercial Port in strengthening Saudi Arabia's maritime transport system. (SPA)
The accomplishment builds on the vital role of Yanbu Commercial Port in strengthening Saudi Arabia's maritime transport system. (SPA)
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Yanbu Commercial Port Boosts Operational Efficiency by Serving 11 Vessels Simultaneously

The accomplishment builds on the vital role of Yanbu Commercial Port in strengthening Saudi Arabia's maritime transport system. (SPA)
The accomplishment builds on the vital role of Yanbu Commercial Port in strengthening Saudi Arabia's maritime transport system. (SPA)

Saudi Arabia’s Yanbu Commercial Port achieved a new operational milestone by successfully serving 11 vessels simultaneously of various sizes and cargo capacities, reflecting the port's high level of operational readiness, reported the Saudi Press Agency on Monday.

The achievement underscores the efficiency of the port's operations and its ability to manage maritime and commercial traffic with a high degree of effectiveness.

It contributes to smoother import and export activities and supports the continuity of supply chains in accordance with the highest operational and logistical standards.

The accomplishment builds on the vital role of Yanbu Commercial Port in strengthening Saudi Arabia's maritime transport system and reinforcing its position as a key logistics hub on the Red Sea coast.

It also supports economic growth and enhances the competitiveness of the maritime and commercial sectors.

Business

IMF Ready to Help Africa Weather Middle East Shock, Says Zeidane

Workers sort avocados for export to Chinese markets, at the Sunripe fresh fruits exporters factory in Limuru district of Kiambu County near Nairobi, Kenya June 4, 2026. (Reuters)
Workers sort avocados for export to Chinese markets, at the Sunripe fresh fruits exporters factory in Limuru district of Kiambu County near Nairobi, Kenya June 4, 2026. (Reuters)
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IMF Ready to Help Africa Weather Middle East Shock, Says Zeidane

Workers sort avocados for export to Chinese markets, at the Sunripe fresh fruits exporters factory in Limuru district of Kiambu County near Nairobi, Kenya June 4, 2026. (Reuters)
Workers sort avocados for export to Chinese markets, at the Sunripe fresh fruits exporters factory in Limuru district of Kiambu County near Nairobi, Kenya June 4, 2026. (Reuters)

The International Monetary Fund's new Africa chief, Zeine Zeidane, said that conflict in the Middle East has created difficulties for sub-Saharan Africa but reaffirmed the fund's commitment to aiding nations under economic strain.

Zeidane, who assumed his role as Director of the IMF's African Department on May 1, oversees operations and engagement with 45 countries across the region.

"My immediate priority is really to help countries in ‌the region to weather ‌this shock," Zeidane said at ‌a ⁠media briefing.

The IMF ⁠has already reached staff-level agreements to provide augmented financing in response to the conflict's effects for Burkina Faso, The Gambia and São Tomé and Príncipe.

For Ethiopia, which has a large IMF program in place, Zeidane said the fund accelerated about $200 million ⁠in financing.

Zeidane warned that disruptions linked to ‌the Middle East conflict could ‌take months to resolve, noting that a ceasefire was already ‌in place but that Gulf nations had ‌indicated it typically takes six to seven months for production and exports to resume fully.

He added that the Middle East's role as a significant exporter of fertilizers would have ‌far-reaching implications for Africa's food security and production costs.

Despite immediate challenges, Zeidane expressed ⁠optimism over ⁠sub-Saharan Africa's long-term prospects, noting that prior to the current crisis, the region was among the fastest-growing globally and had made strides in fiscal consolidation.

"The future, the next growth engine for the world, will be Africa," he said. "We need to support Africa to unlock its potential."

Zeidane, who began his IMF career in 2012, previously served as Mauritania's prime minister, central bank governor and economic adviser to the president. He succeeded Abebe Aemro Selassie, who retired from the IMF in May.

Business

The High Cost of Hormuz: $37 Billion Shock Exposes Iraq’s Economic Vulnerability

A drone view shows oil trucks arriving from Iraq on their way to the Baniyas oil terminal, Syria, May 14, 2026. (Reuters)
A drone view shows oil trucks arriving from Iraq on their way to the Baniyas oil terminal, Syria, May 14, 2026. (Reuters)
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The High Cost of Hormuz: $37 Billion Shock Exposes Iraq’s Economic Vulnerability

A drone view shows oil trucks arriving from Iraq on their way to the Baniyas oil terminal, Syria, May 14, 2026. (Reuters)
A drone view shows oil trucks arriving from Iraq on their way to the Baniyas oil terminal, Syria, May 14, 2026. (Reuters)

The recent regional war and the closure of the Strait of Hormuz have pushed Iraq’s economy into one of its most serious crises in decades. The massive financial losses are more than just another consequence of regional conflict; they have exposed Iraq’s near-total dependence on a single maritime export route.

As Baghdad struggles to finance public-sector salaries through domestic borrowing and the use of foreign-exchange reserves, the crisis has renewed scrutiny of years of poor planning, corruption, and political obstruction of strategic projects, such as the Basra-Aqaba oil pipeline, initiatives that could have provided alternative export routes and a safety net for the country’s most important source of income.

Financial and energy analysts estimate Iraq’s losses at more than $37 billion, a severe blow to an economy that relies overwhelmingly on oil revenues.

The disruption has forced authorities to draw on domestic debt and accumulated reserves to cover monthly salary and pension obligations estimated at roughly $6.5 billion.

Slow recovery

Although the conflict appears to be winding down and the Oil Ministry has expressed optimism about resuming production, energy experts caution that Iraqi oil fields may require months to return to their prewar output levels.

Before the crisis, Iraq produced more than 4.2 million barrels per day, including approximately 3.5 million barrels exported to international markets.

Observers said the consequences extend beyond the immediate financial shock caused by the freezing of oil revenues. The conflict revealed a “dangerous strategic vulnerability”: Iraq’s overwhelming reliance on southern Gulf export terminals and the Strait of Hormuz as the sole outlet for its most valuable resource.

The crisis has also revived debate over decades of mismanagement and inadequate planning in one of the country’s most vital economic sectors.

Oil trucks arrive from Iraq, on their way to the Baniyas oil terminal, in Qamishli, Syria, May 11, 2026. (Reuters)

A single export gateway

Over previous decades, Iraq possessed several overland export routes, including the Kirkuk–Ceyhan pipeline to Türkiye, the Iraq-Saudi pipeline, and the historic Kirkuk-Haifa and Kirkuk-Baniyas lines. Most have been out of service for years because of wars, political instability, and security challenges.

Successive governments sought to revive export diversification. Among the most significant proposals was the Basra-Aqaba pipeline, championed during the administration of former Prime Minister Mustafa Al-Kadhimi. The project would transport crude oil from southern Iraq to Jordan’s Red Sea port of Aqaba.

Energy specialists regard it as a strategic asset that could have reduced Iraq’s dependence on Gulf shipping routes. Political disputes and regional pressures, however, prevented its implementation.

Limited alternatives

As the crisis intensified and oil revenues dwindled, Iraq attempted to expand exports through Türkiye, Syria, and Jordan. Energy experts said those efforts achieved only marginal results.

Contrary to reports that Iraq was exporting oil through 700 tanker trucks through Syria, former Oil Ministry spokesman Asim Jihad said exports through Syrian territory amount to no more than 200 tankers per day.

He told Asharq Al-Awsat that Iraq is exporting fuel oil rather than crude oil through Syria to avoid bottlenecks at producing fields.

Such shipments, he added, are operationally complex and generate only limited revenue compared with normal export volumes.

On the northern route, Jihad noted that Iraq exports between 150,000 and 200,000 barrels per day through the Kurdistan Region’s pipeline to the port of Ceyhan in Türkiye.

Meanwhile, the older federal pipeline linking Kirkuk to Ceyhan remains out of service because of extensive damage that has yet to be repaired.

A drone view shows the Rumaila oil field in Basra, Iraq, June 8, 2026. (Reuters)

Jihad expressed little optimism that Iraq can establish major alternative export corridors outside the Gulf in the near future, citing time constraints, high costs, and political complications.

He also voiced uncertainty about negotiations with Ankara over future export agreements through Ceyhan, particularly as existing arrangements are set to expire at the end of July.

“The only option left for Iraq is to hope that no new conflict erupts in the Gulf that would once again close the Strait of Hormuz and deprive the country of its primary source of income,” he added.

Cost of the blockade

The Eco Iraq Observatory estimated that Iraq has lost roughly 350 million barrels of oil exports since the Strait of Hormuz was closed on February 28, representing missed sales worth approximately $37.7 billion at average market prices during the period.

According to the organization, Iraq had been exporting between 103 million and 107 million barrels of crude oil per month before the closure. Export losses reached 84.4 million barrels in March, 93.1 million in April, 92.8 million in May, and 79.6 million in June.

Eco Iraq argued that the “New Levant” initiative — a regional economic integration project involving Iraq, Jordan, and Egypt — has become a strategic necessity.

The plan envisions deeper economic cooperation, infrastructure links, and alternative export routes, including the shipment of Iraqi oil through Jordan to Egyptian ports, reducing dependence on geopolitically vulnerable maritime corridors.