Monday, Aug 03, 2020 | Last Update : 11:48 PM IST

132nd Day Of Lockdown

Maharashtra44122827680915576 Tamil Nadu2632221964834132 Andhra Pradesh166586828861474 Delhi1384821233174004 Karnataka134819577252496 Uttar Pradesh97362533571730 West Bengal75516527301678 Telangana6766048609551 Gujarat63684466892482 Bihar5956736637322 Rajasthan4495531216706 Assam4290532385105 Haryana3629729690433 Odisha3491321955236 Madhya Pradesh3353523550886 Kerala259121446383 Jammu and Kashmir2141613127396 Punjab1785311466423 Jharkhand121884513115 Chhatisgarh9608699158 Uttarakhand7593443786 Goa6530466853 Tripura5248346323 Puducherry3806230952 Manipur283117377 Himachal Pradesh2654150813 Arunachal Pradesh19359693 Nagaland19356484 Chandigarh111769819 Meghalaya8742645 Sikkim6582891 Mizoram4702580
  Business   Companies  04 Nov 2019  Saudi Aramco kick-starts what could be world's biggest IPO

Saudi Aramco kick-starts what could be world's biggest IPO

REUTERS
Published : Nov 4, 2019, 9:24 am IST
Updated : Nov 4, 2019, 9:24 am IST

Bankers have told the Saudi government that investors will likely value the company at around USD 1.5 trillion.

The company will spend the next 10 days talking to investors and sounding out their interest and the price range will follow.
 The company will spend the next 10 days talking to investors and sounding out their interest and the price range will follow.

Saudi Arabia: Saudi Arabia’s giant state oil company finally kick-started its initial public offering (IPO) on Sunday, announcing its intention to float on the domestic bourse in what could be the world’s biggest listing as the kingdom seeks to diversify its economy away from oil.

But in its long-awaited announcement, Aramco, the world’s most profitable company, offered few specifics on the number of shares to be sold, pricing or the date for a launch.

 

Bankers have told the Saudi government that investors will likely value the company at around USD 1.5 trillion, below the USD 2 trillion valuation touted by Crown Prince Mohammed bin Salman when he first floated the idea of an IPO nearly four years ago.

Aramco also did not mention what measures it has taken to beef up security following unprecedented attacks on its oil plants in September.

Sources have told Reuters the oil company could offer 1 per cent-2 per cent of its shares on the local bourse, raising as much as USD 20 billion to USD 40 billion. A deal over USD 25 billion would top the record-breaking one of Chinese e-commerce giant Alibaba (BABA.N) in 2014.

 

“Today is the right opportunity for new investors to reap the benefits of Aramco’s ability to achieve value, and boost it on the long-term,” Aramco Chairman Yasir al-Rumayyan told a news conference at the company’s headquarters in the eastern city of Dhahran.

The company will spend the next 10 days talking to investors and sounding out their interest and the price range will follow, he said.

The IPO is designed to turbocharge Prince Mohammed’s ambitious economic reform agenda by raising billions to build non-energy industries and diversify revenue streams.

Rumayyan said a decision on an international listing for Aramco shares will be made in the future, without giving a time frame or possible venue.

 

“Selling a small piece of Aramco in a captive market gives the KSA (Kingdom of Saudi Arabia) more control to prop the value of Aramco up over its fair value,” said Gary Ross, CEO at Black Gold Investors.

Confirmation of the sale of shares in the oil giant, whose formal name is Saudi Arabian Oil Co, comes about seven weeks after the crippling attacks on its oil facilities, underlining Saudi Arabia’s determination to push on with the listing regardless. 

Aramco said it does not expect the September 14 attacks, which targeted plants at the heart of Saudi Arabia’s oil industry and initially halved its production, would have a material impact on its business, operations and financial condition.

 

Tags: saudi aramco, ipo, investment
Location: Saudi Arabia, Riyadh