Saudi Aramco CEO hints local listing to happen soon
The chief executive of Saudi Aramco, the state-owned oil firm that is seen as the kingdom's crown jewel, said on Tuesday that the company is ready for a local listing on the kingdom's stock exchange and that it will happen "very soon."
Abu Dhabi: The chief executive of Saudi Aramco, the state-owned oil firm that is seen as the kingdom's crown jewel, said on Tuesday that the company is ready for a local listing on the kingdom's stock exchange and that it will happen "very soon."
Amin Nasser declined to say how much of the state-owned oil giant would be listed on the Tadawul exchange. Reports have emerged that 1 per cent of the company could be sold locally later this year before more is sold on an international market.
"Aramco is ready for listing, whenever the shareholders make the decision to list, and as you heard from his royal highness Prince Abdelaziz yesterday, it's going to be very soon, so we are prepared," Nasser told reporters on the sidelines of an energy conference in Abu Dhabi. "That's the bottom line," he added.
Saudi Crown Prince Mohammed bin Salman first announced plans for an initial public offering of the company in 2016, saying up to five per cent of the company would be sold publicly. The government has since delayed the timing of the IPO, most recently to finalise a deal that saw Aramco acquire a nearly $70 billion stake in Saudi petrochemicals firm SABIC.
The crown prince has valued Aramco at $2 trillion, but analysts estimate it could be worth closer to $1.5 trillion. Even at that lower end, a partial listing of Aramco would potentially be the world's biggest IPO ever. An Aramco listing is a key part of the crown prince's efforts to diversify the kingdom's oil-driven economy.
Prince Mohammed plans to transfer funds from Aramco to the sovereign wealth fund and use those earnings, from investments abroad, to support large-scale local development projects that can create millions of jobs for young Saudis. Diversification efforts are seen as the kingdom's top priority as oil trades around $60 a barrel, below the $80-$85 range needed to cover government spending.