Saudi Aramco to begin offering IPO shares to investors on 17 Nov

SINGAPORE (ICIS)–Saudi Aramco will start offering shares to prospective investors from 17 November to 4 December, as the next step to much-awaited listing of the oil giant.

The world’s biggest oil exporter issued its prospectus on 10 November with the dates of the bookbuilding process for its IPO on the Saudi stock exchange or Tadawul, but details on issue size and price were left blank.

Saudi Aramco has a share capital of Saudi riyal (SR) 60bn ($16bn) and has 200bn shares with no par value, according to the prospectus.

Expectations in the market are rife that the Saudi energy firm will list 1-2% of its shares, which could be the largest in history given a potential company valuation of $1.5tr.

According to media reports, the IPO price is expected to be set on 17 November, with actual trading on Tadawul likely on 11 December.

Saudi Aramco opted to pursue a domestic listing after years of planning the IPO, but could also eventually decide to list in a major international bourse such as New York, London or Tokyo.

In its prospectus, it said that global demand for crude is expected to grow at a compounded annual growth rate (CAGR) of 0.8% from 2018 to 2030.

For ethylene, global demand is projected to grow at the CAGR of 3.3%, “primarily due to an anticipated growth in demand from China and North America”.

The company has decided to proceed with the IPO after embarking on a string of acquisitions of downstream petrochemical businesses, the biggest of which is a 70% stake in SABIC.

In Asia, Saudi Aramco has acquired a 50% interest in PETRONAS’ Refining and Petrochemical Integrated Development (RAPID) in Malaysia and a 20% stake in India’s Reliance Industries Ltd (RIL) downstream business.

In the first nine months of 2019, the Saudi energy firm generated a net income of $68bn, with revenues at $244bn.

(Top image: An oil facility owned by Aramco)

($1 = SR3.75)