The prominent oil company Saudi Arabian Oil Co, known as Saudi Aramco, has recently reported that a substantial portion of its newest share offering has been acquired by international investors, amassing an impressive US$11.2 billion.
According to Aramco, The majority of the shares constituting the institutional tranche of the offering was allocated to investors located outside of the Kingdom,
with trading set to recommence on the Saudi Exchange.
Confidential sources indicate that international investors laid claim to approximately 58 percent of shares, a significant increase from the 23 percent during the company’s initial public offering in 2019, which set the record for the largest IPO in history.
These sources, who requested anonymity due to the sensitivity of the details, revealed that roughly 70 percent of the international orders originated from the European Union and the United States, with additional contributions from Japan, Hong Kong, and Australia.
Aramco, the crown jewel in Saudi Arabia’s state-dominated economy, declared on May 30 the sale of 1.545 billion shares, or about 0.64 percent of its total issued shares, on the domestic stock exchange.
This secondary offering is anticipated to provide a temporary financial uplift for Saudi Arabia as the nation forges ahead with expansive projects including luxury resorts and stadiums, underpinning its sweeping economic overhaul.
The offering is also perceived as a litmus test for global investor confidence in the midst of the kingdom’s Vision 2030 reform initiative, which is epitomized by mega-projects such as Neom, an envisioned state-of-the-art city in the desert.
With the latest share sale, the Saudi government’s ownership stake in Aramco stands at approximately 81.5 percent. Aramco set the final offer price at 27.25 riyals per share, opting for the lower end of the 26.7 to 29 riyals range previously announced.
On the last trading day before the announcement, Aramco’s shares closed at 28.30 riyals, valuing the company at around US$1.83 trillion.
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