DUBAI, Dec — State-owned oil giant Saudi Aramco has priced its initial public offering (IPO) at the top of its indicative range, three sources told Reuters, raising US$25.6 billion (RM106.7 billion) and overtaking China’s Alibaba to achieve the world’s biggest stock market flotation.
Saudi Arabia relied on domestic and regional investors to sell a 1.5 per cent stake after lukewarm interest from abroad, even at the reduced valuation of US$1.7 trillion.
That was below the US$2 trillion target initially sought by Crown Prince Mohammed bin Salman.
Saudi Aramco’s shares have been priced at 32 riyals (US$8.53) each against an earlier indicative price range of 30-32 riyals per share, the sources said.
At that price, Aramco’s IPO of 3 billion shares will just beat the US$25 billion raised by Chinese tech giant Alibaba in 2014.
Sources told Reuters earlier that Aramco may also exercise a 15 per cent “greenshoe” option, allowing it to increase the size of the deal to a maximum of US$29.4 billion.
Aramco has declined to comment on the pricing of the deal.
A formal announcement is expected later on Thursday, the sources said.
Aramco’s market valuation of US$1.7 trillion will comfortably overtake Apple as the world’s most valuable listed firm. But the listing, expected later this month on the Riyadh stock exchange is a far cry from the blockbuster debut originally envisaged by the Crown Prince.
For a timeline on the IPO’s progress please click on:
Climate change concerns, political risk and a lack of corporate transparency put foreign investors off the offering, forcing the kingdom to ditch ambitions to raise as much as US$100 billion via an international and domestic listing of a 5 per cent stake.
Even at a US$1.7 trillion valuation, international institutions baulked, prompting Aramco to scrap roadshows in New York and London and focus instead on marketing a 1.5 per cent stake to Saudi investors and wealthy Gulf Arab allies. Saudi banks had offered citizens cheap credit to bid.
Riyadh has gone quiet on when or where Aramco could list abroad. — Reuters
