JEDDAH, 16 May 2004 — The government has licensed a new petrochemical joint-stock company based in Riyadh with a capital of SR1.5 billion ($400 million) as part of efforts to boost the private sector’s participation in the national economy.
Commerce and Industry Minister Hashem Yamani licensed the firm, which has a total of 30 million shares with a nominal share value of SR50, the Saudi Press Agency reported.
A total of 138 founders have bought 80 percent of shares, and the remaining 20 percent of shares with a nominal value of SR300 million will be sold to the public through banks, SPA said. The company will invest in industrial, particularly chemical and petrochemical, projects and will have a 99-year, renewable license. It will also engage in the production of propylene, polypropylene, ethylene, polyethylene and other petrochemicals.
The company will market its products within and outside the Kingdom. It will have an 11-member of board of directors appointed by the general assembly for not more than three years. However, the first board will have a term of five years.
“The establishment of the company is part of state policy of expanding the economic base, diversifying sources of national revenue and encouraging the private sector to play an active role in promoting economic growth,” SPA said.
Saudi Arabia is engaged in an ambitious economic reform plan that involves opening up vital sectors to local and foreign private investors. Last week, Yamani announced the establishment of a healthcare company with a capital of SR590 million.