US chemicals group Dow is considering an exit from its joint venture with Saudi Arabian oil company Aramco, according to sources cited by Bloomberg. The partnership, Sadara Chemical, is valued at USD 20 billion (approximately EUR 17.2 billion). Dow currently holds a 35 % stake in the venture, with Aramco holding the remainder.
The potential withdrawal is part of a broader portfolio review by the Michigan-based company in response to a sustained downturn in the chemicals sector. Dow is reported to be focusing on business areas expected to deliver higher returns.
Aramco and financial investors among potential buyers
According to insiders, Saudi Aramco could seek to acquire Dow’s stake in the joint venture. Financial investors or other industry participants could also submit bids for the holding. No final decisions have been taken, and the company may ultimately decide against a transaction. Representatives of Dow did not respond to requests for comment from Bloomberg; Aramco also declined to comment.
Sadara Chemical represents one of Dow’s most significant partnerships in the Middle East. A withdrawal would mark a considerable shift in the company’s regional priorities.
Chemicals industry downturn drives portfolio reassessment
The chemicals industry has been experiencing a prolonged period of weakness. In response, Dow is reviewing both its portfolio and its capital allocation. The potential divestment of its stake in Sadara Chemical is presented in this context as part of the company’s efforts to concentrate resources on higher-yielding business segments.
No timeline for a decision has been indicated, and the outcome of the review remains open.
Source: european-coatings.com
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