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November 10, 2021

Saudi Aramco receives bids for stake sale in gas pipeline network

The Saudi Arabian Oil Company looks to raise more than $15bn with the sale of stake in its natural-gas pipeline network.

By Archana Rani

Saudi Aramco has reportedly received final acquisition bids from BlackRock, Brookfield Asset Management and EIG among others for a stake in its natural-gas pipeline network.

The firm also received bids from Saudi Government-controlled Hassana Investment, Italy’s Snam, China’s Silk Road Fund and Co, reported Bloomberg citing people familiar with the matter.

The stake sale is expected to fetch more than $15bn as Saudi Aramco is exploring new ways to maintain a dividend of $75bn and fund its investment plans.

The final bidders are currently in talks to form a consortium for the potential transaction, the sources told Bloomberg.

Aramco is expected to inform the bidders about the outcome as soon as this month.

However, Aramco declined to comment on the report.

People with knowledge of the matter said that the latest pipeline stake sale deal would be structured in a similar way the firm agreed to divest its 49% stake in its pipeline entity to EIG Global Energy Partners-led consortium of investors earlier this year.

The potential deal underlines that there is significant interest among companies for Middle Eastern oil and gas assets and infrastructure, despite increasing calls for a transition from fossil fuels.

Notably, BlackRock and KKR invested $4bn into Abu Dhabi’s oil pipelines in 2019.

Earlier this year, Reuters reported that Aramco is working with investment banking firms Goldman Sachs and JPMorgan to seek potential buyers for the pipeline asset.

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