Saudi Arabia's government is considering a plan under which state energy giant Saudi Aramco would buy a stake in Saudi petrochemical company Saudi Basic Industries Corporation (Sabic), according to a Reuters report.

The move is understood to be directed at boosting Aramco´s market valuation ahead of its planned initial public offering (IPO).

Saudi Aramco has invited banks to pitch for an advisory role on the potential acquisition of a strategic stake in Sabic, Reuters reported.

Aramco made the invitation to the banks last month, the report said.

Riyadh Stock Exchange-listed Sabic, the world´s fourth-biggest petrochemicals company, is 70 per cent owned by the Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund.

Aramco wants to develop its downstream business as Riyadh prepares to float up to 5 per cent of the company.

Boosting its petrochemicals portfolio further could help attract potential investors for the IPO.