Saudi Arabia intends a slow and steady listing of Aramco on its domestic market, sources conversant in the matter stated on Monday, as it finalizes the roles banks will play in the initial public offering (IPO) of the world’s most prominent oil firm.
The dominion intends to list 1% of the state oil titan on the Riyadh stock exchange before by the year-end and another 1% in 2020, the sources mentioned, as preliminary steps ahead of a public sale of about 5% of Aramco.
Based on the suggested $2 trillion valuation that Saudi Aramco had wished to achieve, a 1% float would be worth $20 billion, a huge breakthrough for the local stock market.
Aramco’s flotation, which could be the world’s greatest IPO, is essential to raise money for Crown Prince Mohammed bin Salman’s plans to broaden the Saudi economy away from oil revenues and has rapidly regained momentum over the previous few days.
Saudi Power Minister Prince Abdulaziz bin Salman said Monday Saudi Arabia was hoping for the Aramco IPO “as soon as possible,” speaking on the challenge for the first time since replacing Khalid al-Falih at the ministry.
The dominion has geared up to accelerate the IPO by bringing in the chief of Saudi Arabia’s sovereign wealth fund, Yassir al-Rumayyan, who was recently appointed as Aramco chairperson and leads an executive panel supervising the plans.
Aramco is deciding on the final list of banks that will manage the contract, with orders expected in the coming days, sources said.
JPMorgan, Morgan Stanley and National Commercial Bank are expected to have major roles, and Citi, HSBC, Goldman Sachs, and Samba Financial Bank will possibly be added to the list of banks handling the transaction, one of the sources stated.