F1500.edited.docx - Brief summary History Saudi Aramco is a...

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Brief summary History Saudi Aramco is a state-run multinational company that deals in natural gas and petroleum. The Company draws its origin from the oil shortage during the Second World War. The Company started as a small group of experts surveying for oil in the desert of Saudi. Saudi Aramco, founded in 1933, is headquartered in Dhahran, Saudi oil industry’s administration center ( Aramco, 2017 ). The firm owns the second largest oil reserve, making it rank among the largest organization in the globe by revenue. Culture Saudi Aramco bases its operations on ethical standards where its workers uphold humility, resiliency, respect, and integrity. The Company's culture explains that the firm's employees' behavior defines the Company and its reputation ( Siddique, 2016 ). The company employees uphold accountability since every worker’s action is accountable for goal achievement. A company’s value and employee behavior are significant since they define a firms’ culture. Industry Saudi Aramco Company operates in the petroleum industry. The sector involves firms that carry out global processes of extraction, production, and distribution of petroleum products. The Company operates as an oil exploration business in the petroleum sector. Products and services The Company produces and distributes natural gas, petrochemical, and petroleum products. Saudi Aramco refines and supplies asphalt, oil, kerosene, fuel, gasoline, diesel, among other products ( Ramady, 2018 ). The firm operates three refineries in Saudi Arabia and also partners with other five global refiners. The organization also offers crude oil marketing services. Why the change was needed The major reason for SABIC’s acquisition deal was to raise capital for a long-term investment which would transform the economy of Saudi Arabia. Saudi Aramco needed to buy shares from SABIC for the government to get more cash for its diversification programs. SABIC’s acquisition would also increase Saudi Aramco’s present in the global petrochemicals sector and market ( Weijermars, 2020 ). SABIC is one of the world's most diversified chemical organizations. The acquiring firm would use the opportunity to foster global chemical industry growth and support diversification in Saudi Arabia. Companies engage in acquisition deals to create more wealth for their shareholders. Saudi Aramco would use the acquisition to create synergies and create more value through the integration of vital processes like procurement, manufacturing, and marketing. The acquisition is one of the world’s biggest transactions in the petroleum industry. The acquiring firm expected to record a swift growth in the future demand for oil. The Company bought the shares from SABIC through Public Investment Fund (PIF) to diversify Saudi Arabia's economy from oil. SABIC expected to benefit from Saudi Aramco's strong feedstock of chemicals. Additionally, the acquired also anticipated to profit from the acquirer’s
large scale execution of major projects. The transaction was SABIC’s strategy to benefit from

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