Saudi Aramco is close to signing a $10bn loan deal, which will replace its existing $4bn credit facility due to mature later this year, Reuters has reported.
Banks in talks for the deal have been told that “unlike the previous loan which remained untapped, this could be used in coming months”.
Aramco could use part of the loan to buy a stake in German synthetic rubber firm Lanxess, the report added, with the deal expected to conclude by the end of the month.
Last month, Reuters reported that Lanxess is in talks with Russia’s petrochemical company NKNK and Aramco to sell a stake in its tyre rubber business.
“They have always been very clear that they wouldn’t draw on the facility, which has allowed them to drive a hard bargain on pricing, but they have said this time that they may draw when needed,” one banker working on the transaction told the news agency.
“Aramco is a first-tier borrower in Europe and the U.S. and the deal is doing very well as you would expect,” said a second banker.
The deal is expected to attarct high interest in major global lenders, with its existing credit facility involving as many as 29Â local and international banks such as Citigroup, HSBC, JP Morgan, Riyad Bank, Saudi British Bank and others.
