Saudi Aramco will use cash and debt to pay its dividend of $18.75 billion for the first quarter of this year, the company’s chief executive said after the top oil firm sealed a major acquisition deal.
Amin Nasser said the company will use its free cash definitely most of the time, but other debt instruments from banks or bonds are also available as it has a strong balance sheet. Aramco has completed its purchase of a 70 percent stake in petrochemicals company SABIC from Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), for $69.1 billion and extended the payment period by three years to 2028.
After the SABIC purchase, the ratio between Aramco’s debt and its market value (gearing) would increase. Compared to a range of 11-36 percent for Western rivals, Aramco’s gearing in Q1 this year dropped to minus 5 percent.
