Saudi industrial group Tasnee plans more industrial acquisition and is likely to make its first Islamic bonds, or Sukuk, issue in 2009, two senior company executives said on Tuesday. Tasnee, whose Cristal unit unveiled earlier on Tuesday a $289 million takeover bid for Australian mineral sands producer Bemax Resources Ltd, plans a SR2 billion ($533.3 million) rights issue this year, Chief Executive Moayyed Al-Qurtas told Reuters in an interview. “There are expansion projects through acquisitions, but acquisitions are no exact science: We have to identify the right target and opportunity. It will take time,” he said in the interview, attended by finance chief Fayez Al-Asmari. Both executives could not say anything about the Bemax takeover offer because announcements of this kind by Saudi listed firms have to be first made through the bourse regulator. Like peers in the Gulf Arab region, Tasnee, which says it is Saudi Arabia's second-largest petrochemicals company by output volume, benefits from cheap access to cheap feedstock in the oil-exporting region. US Lyondell Chemical Co. agreed last year to sell its titanium dioxide business to Tasnee for about $1.2 billion, a higher price than expected. Cristal's offer to buy Bemax offered a 45 percent premium on the stock's closing price on Monday. Formerly known as National Industrialization Co, Tasnee has so far identified projects worth 3.44 billion riyals, including Cristal's expansion plans. Tasnee also secured a SR1.8 billion syndicated loan earlier in 2008 to help fund expansion. The expansion aims mainly at boosting production of polypropylene, acrylic acids and raising olefins production capacity from 500,000 tons to 1.8 million tons. “But this is just the beginning, the equity proportion is only a fraction of what we intend to do,” Qurtas said. “We are not limiting ourselves by the limits of geography for acquisitions. We are looking for synergies with our existing products or with other industries to grow the company in a profitable way,” he added, without being more specific. Tasnee is among firms that are leading consortia bidding for a new oil refinery in the southern province Jizan, of which plans were first announced by the government in 2006. “The equity part in Jizan refinery will be worth SR15-20 billion,” Qurtas said.
