Saudi Aramco issues prospectus for IPO — KSA Business

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Saudi Arabia's condition-owned oil huge Aramco disclosed it is going to promote as much as.5% of its shares to particular traders, however in a prolonged doc launched late Saturday it didn't disclose how an excessive amount of the corporate will probably be floated when it goes public on the nation's home alternate. The company will announce a final price for its shares on 5 December, with trading expected to start in mid-December, the New York Times said.

After years of delay and false starts, the state-owned company last week said it will sell an unspecified number of shares on the Riyadh stock exchange in what is expected to be the biggest IPO in history.

Saudi Aramco's prospectus says all relevant regulatory and corporate approvals required for the offering have been granted and an announcement of final offer price will be December 5 2019, with bidding and book building period to run November 17 to December 4.

"The targeted percentage of offer shares allocable to individual investors will be up to 0.5% of the shares", the prospectus said.

The prospectus also referred to risks its business faces such as the impact of climate change on the demand and price of hydrocarbons.

Saudi Arabia's Crown Prince Mohammed bin Salman attends a meeting with US Secretary of State Mike Pompeo in Jeddah, Saudi Arabia, on September 18, 2019.

The prospectus named a host of global banking giants - from Citibank to Credit Suisse and HSBC - that it has hired as financial advisers and bookrunners.

Crown Prince Mohammed bin Salman of Saudi Arabia is trying to raise billions of dollars through the venture by diversifying the Saudi economy away from oil and investing in non-energy industries.

The firm has said there were no current plans for an worldwide stock sale, indicating that the long-discussed goal for a second offering on a foreign bourse had been put aside.

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Sources have said the company could sell 1%-2% on the Saudi stock market in what could be the world's largest listing.

There are also reports the firm is struggling to get institutional investors on board amid a bearish outlook for the energy sector and questions over the company's transparency and governance.

The Russia-China Investment Fund is working to attract Chinese investors for Aramco's planned IPO, the head of Russia's RDIF sovereign wealth fund said on Thursday.

Reuters reported last month that Aramco can take advantage of new market rules that allow issuers the flexibility to sell more shares to retail investors, likely exceeding the usual 10 per cent seen in recent IPOs.

Why is Aramco selling shares?

Profit in the first half of this year was measured at $46.9 billion (€42.5 billion), exceeding that of the world's most profitable listed company, United States tech giant Apple Inc., which made $31.5 billion (€28.6 billion).

RESERVES - Aramco reserves stood at 256.9 billion barrels of oil equivalent at the end of last year - sufficient for 52 years, much longer than the five major global oil companies who claim between nine and 17 years.

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