Saudi Aramco raises $25.6bn in the world’s biggest IPO

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DUBAI/RIYADH: State-owned oil giant Saudi Aramco’s initial public offering (IPO) will be the biggest in history, but will still fall significantly short of the towering $2 trillion valuation long sought by Crown Prince Mohammed bin Salman.

Aramco priced its IPO at 32 riyals ($8.53) per share, the top of its indicative range, according to three sources familiar with the decision, raising $25.6 billion and beating Alibaba’s record $25 billion listing in 2014.

At that level, Aramco has a market valuation of $1.7 trillion, comfortably overtaking 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.

Saudi Arabia relied on domestic and regional investors to sell a 1.5pc stake after lukewarm interest from abroad, even at the reduced valuation of $1.7 trillion.

Sources told Reuters earlier that Aramco may also exercise a 15pc “greenshoe” option, allowing it to increase the size of the deal to a maximum of $29.4 billion.

Aramco has declined to comment on the IPO pricing. A formal announcement is expected later on Thursday, the sources said.

The pricing comes as the Organization of the Petroleum Exporting Countries (OPEC) is gearing up to deepen oil supply cuts to support prices, provided it can strike a deal later this week with allies such as Russia.

 

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