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Aramco revives Reliance Industries interest

Saudi Aramco has indicated that it is doing a due diligence on picking up a stake in the oil-to-chemicals (O2C) business of Reliance Industries, which raises the prospects of some movement in the proposed $15-billion transaction.

However, at a conference call with investors after it announced its results for the half- year ended June 30, Amin H. Nasser, CEO, president and director of Aramco, did not indicate any timeline for the closure of the transaction as he refrained from giving any further details.

This is the first official comment coming from the top brass of the oil giant in several months.

“With regard to the Reliance deal, all I can say at this stage, it’s going through the due diligence. So depending on it, we will make our decision. This is a big deal. So we need to take our time to review and then decide based on the outcome of the study,’’ Nasser said when asked for an update on the progress of the deal.

Addressing shareholders at its annual general meeting last month, RIL chairman and managing director Mukesh Ambani had said that the proposed transaction is not proceeding for now.

“Due to unforeseen circumstances in the energy market and the Covid-19 situation, the (Aramco) deal has not progressed according to the original timeline,’’ Ambani said.

The deal was initially announced by the RIL chief at a shareholders meeting in 2019 where he had disclosed that Aramco would pay $15 billion for a 20 per cent stake in its O2C business.

While RIL is spinning off its O2C business into a separate subsidiary, analysts are of the view that Reliance will have to settle for a much lower valuation. It is not immediately clear if Nasser’s latest comments would lead to Reliance accepting a lesser valuation.