The Saudi Public Investment Fund (PIF) will take over the metallurgical division of chemicals manufacturer Sabic. The acquisition includes the purchase of Saudi Iron and Steel Company (Hadeed), a wholly owned subsidiary of Sabic, for approximately USD 3.3 billion.

PIF believes that the acquisition of Hadeed will strengthen its efforts to support local industry development and meet the growing demand for steel products in various sectors, including construction, automotive, utilities, renewable energy, transportation and logistics.

These transactions underscore the growing influence of the Saudi investment fund in the Arab world's largest economy. PIF invests in a range of sectors, including automotive, food and agriculture, construction, real estate, healthcare and many others, with the aim of diversifying and enhancing the Kingdom's economic sustainability through strategic investments and initiatives. It seeks to prepare the country, which is the largest exporter of oil, for a post-oil future. Last week, for example, one of the companies owned by the fund acquired Jet Lessor for US$3.6 billion. The PIF also has plans to enter the mining sector and is currently in talks to buy a 10% stake worth US$2.5 billion in base metals miner Vale SA.

Sabic, the global petrochemicals giant, reported an 85% drop in net profit in the second quarter due to lower average selling prices and reduced demand. The company cited the reason for the divestment was to focus on its core business. The transaction is expected to be completed by the end of the first quarter of 2024.