According to the Arab News, Jeddah-based Dabbagh Group is reportedly planning to sell a 19 percent stake in its Jeddah-based lubricants business Petromin ahead of a potential public offering of the unit in 2015. Dabbagh may consider selling a further 30 percent of Petromin to the public through a bourse listing in the first half of 2015, which would leave Dabbagh with a 51 percent stake, sources said.
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Dabbagh Group owns 100 percent of Petromin after buying out a 49 percent stake held by India's Hinduja Group earlier this year following strategy differences between the two partners. At that time, Petromin was valued at about US$700 million.

The 19 percent stake is being offered to a small group of Saudi and Gulf-based investors and one or more party could end up holding some of the company following the process.

According to banking sources speaking on condition of anonymity, proceeds from the stake sale will be used by family-owned Dabbagh Group to repay debt used to buy out its Indian partner.

Founded in 1962, the Dabbagh Group, which has interests in food, real estate and automobile services among others, employs 50,000 people in 40 countries.

Petromin, the oldest lubricants company in the Middle East, was formed by royal decree in 1968. The company, the largest manufacturer of (blended) lubricant products in the Kingdom of Saudi Arabia with the largest market share, exports lubricants to more than 35 countries in the Middle East, Africa and Asia.

Dabbagh Group and Gulf Oil International, a Hinduja Group company, had paid $200 million to buy Petromin in November 2007 from a joint venture between Saudi Aramco and Mobil Investments S.A., an ExxonMobil affiliate.