US-based leading institutional investor to the global energy sector, EIG has stated that a consortium it led has closed a deal to buy 49 percent of Saudi Aramco’s (Aramco) pipelines business for $12.4 billion.
The Aramco Oil Pipelines Company (Aramco Oil Pipelines) is a newly formed entity with rights to 25 years of tariff payments for oil transported through Aramco’s stabilized crude oil pipeline network.
According to the reports, the EIG-led co-investment process in Aramco Oil Pipelines attracted a global group of leading institutional investors from China, the Kingdom of Saudi Arabia, Korea, the United Arab Emirates, and the United States.
“It has included Abu Dhabi’s Mubadala Investment Company, Silk Road Fund, Hassana, and Samsung Asset Management,” the company added.
“We are pleased to have completed this transaction with Aramco, a preeminent global energy supplier. The caliber of this marquee global infrastructure asset is further evidenced by the leading investors that have invested alongside EIG. We are honored to be working with this world-class consortium and look forward to a long-term, fruitful partnership.”
HSBC Bank acted as financial advisor to EIG in connection with the transaction, and Latham & Watkins served as EIG’s legal advisor.
Even after the deal, the oil giant will retain full ownership and control of its stable crude oil pipeline network as it owns the remaining 51 percent of the company. Furthermore, the deal enables Aramco, the world’s third-most valuable company, to monetize its pipeline assets while maintaining overall operational management of the network.
Recently, Saudi Aramco has raised $6 billion through its first US dollar-denominated sukuk issue. It is reported that the money will be used for “public company activities or any other indicated purposes” in the sukuk offer paperwork.