S Korea’s Hanjin Energy buys 28.4% stake in S-Oil

06 March 2007 08:12  [Source: ICIS news]

SINGAPORE (ICIS news)--South Korea’s Hanjin Energy is to become S-Oil Corp’s second largest shareholder after it agreed to buy a 28.4% stake for won (W) 2,400bn ($2.54bn).

Aramco Overseas Co (AOC), the largest shareholder of S-Oil, said in a statement on Tuesday that Hanjin will buy 31.9m treasury shares from the third largest refiner in South Korea.

AOC is a subsidiary of energy major Saudi Arabian Oil Co (Saudi Aramco) while Hanjin Energy is a unit under South Korean shipping conglomerate Hanjin Group.

Through the deal, S-Oil will secure long-term supply arrangements of fuel products to members of the Hanjin Group, including Korean Air Lines and Hanjin Shipping, said AOC.

In turn, S-Oil may also develop shipping arrangements of crude oil and petroleum products through Hanjin Shipping.

The transaction will allow S-Oil and Korean Air to cooperate on marketing and branding as well as joint promotional programmes, AOC added.

S-Oil presently supplies 20% of Korean Air’s annual oil consumption and 30% of Hanjin Shipping’s annual oil consumption.

AOC holds a 35% stake in S-Oil.

($1 = W943.06)

By: Jeanne Lim
+65 6780 4359

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