Aramco in talks to buy stake in refining business of India’s Reliance

The value Reliance Industries’ refining and petrochemicals businesses is said to be at around $55 billion to $60 billion. (File/AFP)
Updated 18 April 2019
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Aramco in talks to buy stake in refining business of India’s Reliance

  • The Times of India reported earlier that Aramco was in talks to buy up to a 25 percent stake
  • Aramco did not immediately respond to a request for comment

DUBAI/NEW DELHI: State oil giant Saudi Aramco, the world’s biggest oil producer, is in talks to buy a minority stake in the refining and petrochemicals businesses of India’s Reliance Industries Ltd, sources familiar with the matter said on Wednesday.
The Times of India reported earlier that Aramco was in talks to buy a stake of up to 25 percent, which could be worth around $10-15 billion, valuing the Indian company’s refining and petrochemicals businesses at some $55-60 billion.
Aramco’s discussions with Reliance were “serious,” one source said. Another source said talks with Reliance were so far for a 25 percent stake.
“Reliance has offered an integrated deal — a stake in existing refineries and the planned 600,000 barrels per day (Jamnagar) refinery, along with petrochemical business,” the second source said.
Aramco’s chief executive, Amin Nasser, said in February that the Saudi company was in talks on possible investments in Indian projects involving firms that included Reliance.
Aramco and Reliance declined to comment on Wednesday.
Reliance, controlled by Asia’s richest man, Mukesh Ambani, is India’s biggest refining and petrochemicals company and runs a 1.4 million barrels per day refining complex at Jamnagar in western India. It plans to expand capacity to 2 million bpd by 2030, according to plans shared with the Indian government.
Aramco is expanding its refining and petrochemical business globally by signing new deals and boosting the capacity of its existing plants.
Last year, Aramco and the United Arab Emirates’ national oil company ADNOC teamed up with state-run Indian refiners in a plan to build a 1.2 million bpd refinery and petrochemical project in Maharashtra state.
However, the planned refinery faces delays, as thousands of farmers have refused to surrender land for it and the Maharashtra government is looking to move the plant’s location.
Saudi Crown Prince Mohammed bin Salman visited India in February and said then that he expected investment opportunities worth more than $100 billion there over the next two years.
Ambani has traveled to Saudi Arabia at least twice since December, discussing joint investment among other issues with Aramco’s chief executive, Amin Nasser.


SoftBank to launch Vision Fund 2 mega-venture

Updated 54 min 54 sec ago
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SoftBank to launch Vision Fund 2 mega-venture

  • Vision Fund 2 will aim to pull in existing investors such as the Public Investment Fund in Saudi Arabia and Mubadala in the UAE
  • Vision Fund 2 is expected to at least equal the original fund’s $97 billion fund, and could reach $150 billion

LONDON: The global mega-investor SoftBank Vision Fund is preparing to launch another giant investment venture.
Vision Fund 2 will aim to pull in existing investors such as the Public Investment Fund in Saudi Arabia and Mubadala in the UAE, the biggest investors in the original fund along with SoftBank, the Japanese group run by Masayoshi Son.
Sources told Arab News that Vision Fund 2 is expected to at least equal the original fund’s $97 billion fund, and could reach $150 billion — which would make it the largest private investment fund in history.
A team from SoftBank Investment Advisers led by its chief executive Rajeev Misra and Masayoshi Son have been in preliminary discussions with potential investors for several months.
They have been talking to sovereign wealth funds in the Middle East and elsewhere, as well as big global corporates, some of which were also investors in the first fund.

*** Read our full interview with CEO Rajeev Misra here: SoftBank Vision Fund stands shoulder to shoulder with Saudi Arabia — CEO Rajeev Misra ***
Investment is also expected from global banks, insurance companies and pension funds, and SoftBank is expected to put up about $40 billion.
The first phase of the launch is due to end “in the next few months,” with a final close around 12 months later.
The original fund plans to return profits to existing investors over the next few months, including big partners such as PIF, Mubadala and SoftBank. If they see healthy returns they may be more likely to invest heavily in the new fund.
The interests of Saudi Arabia and the Vision Fund align as the Kingdom diversifies away from reliance on oil, Misra told Arab News. “Our commitment is to support the creation of tens of thousands of jobs in Saudi Arabia, high-tech jobs not blue collar, over the next few years,” he said.