Dow, which owns a 35 percent stake in Sadara Chemical, said it had signed a non-binding agreement with Aramco to boost that interest to 50 percent.
The deal is expected to follow the spin-off of Materials Science Co within 18 months and a creditors’ reliability test, which is part of the limited-recourse financing used to fund the construction of the complex.
Once the transaction is complete, the Sadara Chemical IPO-SACH.SE joint venture will be 50:50 owned by the two partners.
In May, Sadara’s chief executive said Aramco planned to cut its stake in Sadara via an initial public offering.
A statement gave no update on the listing of Sadara, which is due to take place on the Saudi stock market. It did not disclose any financial terms.
Sadara said this month it had commissioned the last plant at its petrochemicals complex in Jubail, in eastern Saudi Arabia.
The Sadara complex has 26 integrated facilities and the capacity to produce more than 3 million tonnes of products per year.
Many products are being made in the kingdom for the first time, including isocyanates, as the world’s top oil-exporting country moves downstream.
Sadara will transform the kingdom “from a consumer and importer to a global exporter,” Saudi Energy Minister Khalid al-Falih has said.
Reporting by Ahmed Farhatha and Reem Shamseddine; Editing by Sai Sachin Ravikumar and Dale Hudson