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SAUDI ARABIAN BASIC Industries Corporation (Sabic) is set to be the first company in Saudi Arabia to take advantage of changes in the capital markets regulations to raise money on the newly established domestic bond market.
This will accelerate the kingdom's financial revolution, which has transformed the way in which Saudi companies can finance their activities. Where until now they have been almost entirely reliant on bank borrowing, the largest of them are now looking to tap the equity and debt markets.
Sabic, which is already one of the world's biggest petrochemicals companies and Saudi Arabia's largest equity listing, plans to use the SR1 billion ($267 million) bond, which is expected to be structured in compliance with Islamic law, to finance further international expansion.
Mohammed Al-Mahdy, Sabic's vice-chairman and chief executive, says that $8 billion will be spent on new projects in the next three to five years, probably in Europe and Asia.