KUALA LUMPUR (Oct 2): Petronas Chemicals Group Bhd (PCG) is selling a 50% stake in wholly-owned unit PRPC Polymers Sdn Bhd to Saudi Arabian Oil Co's (Saudi Aramco) subsidiary under a planned estimated US$900 million (RM3.8 billion) deal to share PRPC Polymers' business risk.

In a statement to Bursa Malaysia today, PCG said it was selling the 50% stake in PRPC Polymers to Saudi Aramco's wholly-owned subsidiary Aramco Overseas Holdings Coöperatief U.A. (AOHC). PCG said the estimated US$900 million deal includes the divestment of 50% of any shareholder loans held by PCG in PRPC Polymers to AOHC.

"PCG will share the project and operation risk with Saudi Aramco upon divesting 50% of the equity interest and 50% of the shareholder loans in PRPC Polymers to AOHC.

"PCG will have a positive cash flow impact by decreasing its capex commitment as a result of Saudi Aramco’s 50% participation in PRPC Polymers. Subsequently, it will provide PCG with the financial flexibility to pursue other strategic growth projects," PCG said.

PCG said said the company and AOHC had signed the share purchase agreement last Friday (Sept 29). Today, PCG said upon completion of the PRPC Polymers stake and shareholder loan divestment, PRPC Polymers will cease to be a subsidiary of PCG.

At Bursa Malaysia, PCG's share trade was suspended between 9am and 10am today in conjunction with the announcement. At 10:19am, PCG shares were traded at RM7.19 with 165,700 shares transacted.