) announced that Sadara Chemical Company, its joint venture with
Saudi Arabian Oil Company (Saudi Aramco), has secured main
financing for the Sadara project. Sadara Chemical has entered
into agreements with export credit agencies, commercial banks and
the Public Investment Fund of the Kingdom of Saudi Arabia for
roughly $10.5 billion of project financing.
The main financing supplements around $2 billion raised
through a Sukuk issuance in Apr 2013, bringing the total Sadara
project financing to roughly $12.5 billion. The funds raised will
be used for the construction and start-up of a world scale
chemical complex in Jubail Industrial City II, Kingdom of Saudi
The complex will have 26 manufacturing units and will include
flexible cracking capabilities. Sadara is expected to produce
more than 3 million metric tons of high-value performance
plastics and specialty chemical products. Sadara's first
production is expected to commence in the second half of 2015,
with full production starting in mid-2016. Financial close of the
project financing is expected to occur in the third quarter of
Dow has formed the joint venture to ensure long-term
profitable growth in its downstream, innovation-driven businesses
and also in the fast-growing regions such as Asia Pacific, the
Middle East and Africa, and Eastern Europe. The joint venture is
expected to generate EBITDA margins of 35%-40% and reap average
equity earnings of $500 million annually during the first ten
years after its start-up. This will also enable Dow to be at a
competitive cost position.
Dow currently holds a Zacks Rank #3 (Hold).
Other companies in the chemical industry having favorable
Zacks Rank are
Shin-Etsu Chemical Co., Ltd.
). Shin-Etsu Chemical and Methanex retain a Zacks Rank #1 (Strong
Buy), whereas Celanese is a Zacks Rank #2 (Buy) stock.
CELANESE CP-A (CE): Free Stock Analysis
DOW CHEMICAL (DOW): Free Stock Analysis
METHANEX CORP (MEOH): Free Stock Analysis
SHIN-ETSU CHEM (SHECY): Get Free Report
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