Discussions between Clarent and SABIC on the bankruptcy of a joint venture

Clarinet announced Thursday it has decided, with Saudi Basic Industries Corporation (SABIC), its largest shareholder, to suspend negotiations on a joint venture, which resulted in a 10% fall in Swiss Chemical Industries.

The company, whose CEO abruptly resigned this week, also suffered a loss in the first half, penalized by the provision of provisions for a European survey of competitive practices.

SABIC, which holds a 25% stake in Clarent, and the Swiss company are working to integrate Clarent specialty additives and dyes into a part of its specialty chemicals business.

Earlier this year, Saudi Aramco signed an agreement with the state-run Public Investment Fund to acquire a controlling stake in SABIC for $ 69.1 billion.

"Market conditions could be one of the reasons for the suspension of the joint venture, given the low prices of petrochemicals in the world, which have hurt the sector's results," said Mazen Al Sudairi, director of research at Al Rajhi Capital.

SABIC bought its stake in Clarent in 2018 to become the savior who ended the battle of the Swiss company with active investors who had blocked a potential $ 20 billion merger with US-based Huntsman.