Aramco Eyes Downstream Expansion in LATAM

Aramco Eyes Downstream Expansion in LATAM

/ Financial News / Monday, 18 September 2023 11:56

Aramco has agreed to purchase a 100% equity stake in Esmax Distribusción SpA (“Esmax”) from Southern Cross Group, a Latin America-focused private equity company. The transaction is subject to certain customary conditions, including regulatory approvals.

Esmax is a leading diversified downstream fuels and lubricants retailer in Chile. Its national presence includes retail fuel stations, airport operations, fuel distribution terminals and a lubricant blending plant.

Also read: Saudi Aramco Q2 2023 Profits Decline by 38%

Aramco’s planned acquisition of Esmax would be its first downstream retail investment in South America, recognizing the potential and attractiveness of these markets while advancing Aramco’s strategy of strengthening its downstream value chain. Through this transaction Aramco aims to secure outlets for its refined products and expand its retail business internationally. In addition, the deal would further open new market opportunities for Valvoline branded lubricants, following Aramco’s acquisition of the Valvoline Inc. global products business in February 2023.

Commenting on the development, Mohammed Y. Al Qahtani, Aramco Downstream President, said, “We are excited by the opportunities it presents, creating synergies with our extensive trading and manufacturing systems. Moreover, it creates a platform to launch the Aramco brand both in Chile and South America more broadly, unlocking significant potential to capitalize on new markets for our products. Esmax is a well-run business in Chile with more than 100 years of experience with quality assets and growth potential. We are excited to have the outstanding people of Esmax join the Aramco family as we continue to execute on our downstream strategy.”

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