New company not workable under current regulatory framework in Saudi Arabia
Saudi International Petrochemical Company (Sipchem) and Sahara Petrochemicals Company (Sahara) have put their planned merger on hold after talks broke down over an acceptable structure for the new firm.
The two Saudi-based petrochemicals producers had been planning to create a new integrated company with a market capitalisation of $5.8bn.
Although both companies are still convinced that the proposed merger is in the interest of their shareholders, the companies reached a conclusion that it is difficult to implement this merger under the current regulatory framework [in Saudi Arabia] using a structure acceptable to both companies, Sipchem said in a statement on its website.
Both companies have not completely ruled out the merger and said they would consider holding talks on the matter in the future.