Saudi International Petrochemical Company’s (Sipchem) board has approved a sukuk issuance.

Local Riyad Capital and National Commercial Bank (NCB) Capital were appointed as lead managers for the issuance.

Local Salman al-Sudairy and the US’ Latham Watkins are legal advisors to the lead managers and local Khoshaim & Associates and the UK’s Allen Overy are advising Sipchem.

Sipchem is seeking to diversify its sources of funding, according to the stock market disclosure, but did not specify the intended size or use of the sukuk.

Sipchem recently acquired Kuwaiti Icarus’ stake in its Jubail acetyl complex. Ikarus held an 11 per cent stake in International Acetyl Company and International Vinyl Acetate Company for which Sipchem paid SR375m ($100m). Sipchem stake in each company has increased to 87 per cent while Germany’s Helm still holds 10 per cent and the Saudi Supreme Council of Endowments 3 per cent.

Sipchem secured $1.8bn of project finance in 2008 to build the acetyl complex, and around $385m in 2012 to build the third phase of the Jubail petrochemicals complex.

It has several projects due to start commercial operations in 2016 including a polybutylene terephthalate plant (PBT), a Saudi specialised products plant and an ethylene vinyl acetate (EVA) film plant.

Sipchem’s net income fell 52.5 per cent from SR606m in 2014 to SR288m in 2015. The fall in petrochemicals prices since 2014 caused the company’s revenues to fall by 40 per cent.