In a recent development from Riyadh, the prominent oil company Saudi Aramco has announced the successful sale of shares, with a substantial portion being acquired by investors beyond Saudi Arabia’s borders, amounting to an impressive $11.2 billion capital raise.
Before the commencement of trading on the Saudi exchange, Aramco revealed that the institutional tranche of the share offering was predominantly secured by international entities. This move underscores the growing global confidence in the Saudi market.
Confidential sources disclosed that approximately 58 percent of the shares were snapped up by global investors, a significant increase from the 23 percent mark during Aramco’s 2019 initial public offering. Notably, the majority of the international interest flowed from regions such as the European Union and the United States, complemented by participation from Japan, Hong Kong, and Australia.
Aramco, a cornerstone of the Saudi economy with significant state ownership, declared the sale of 1.545 billion shares, which represents roughly 0.64 percent of its total issued shares, on the domestic stock market.
The offering is anticipated to inject a brisk fiscal stimulus into the Saudi economy as the nation undertakes substantial developmental projects, including the construction of resorts and stadiums. These initiatives form part of the kingdom’s bold Vision 2030 economic reform plan, which also encompasses the establishment of NEOM, an envisioned ultra-modern city.
Following the secondary share offering, the Saudi government retains an 81.5 percent stake in Aramco. The share price was set at 27.25 Saudi riyals ($7.27) each, which sits at the lower spectrum of the previously announced range.
On the last trading day prior to the announcement, Aramco’s shares closed at 28.30 Saudi riyals per share, rendering the company’s valuation at approximately $1.83 trillion.