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Saudi Aramco on the way to claim the world’s largest IPO

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Saudi Aramco on the way to claim the world’s largest IPO

The oil giant Saudi Aramco is making way to set the stage for the world’s largest IPO.

On Sunday, the state-owned company revealed a range for its Initial Public Offering that places its valuation up to $1.7 Trillion prior to its public debut which is expected to be the largest so far. However, it’s below the $2 trillion sought by the crown prince of Saudi Arabia.

It is important to note that Aramco won’t be selling its shares directly to investors in the United States and other markets in the world due to the fact that the initial public offering (IPO) will be limited to Saudis and foreign institutions that are allowed to invest in the kingdom’s stock market, according to Reuters.

The oil giant stated that it is planning to sell 1.5% of the company which is about 3 billion shares, at an indicative price range of 30 riyals to 32 riyals. This would give its IPO a value of about 96 billion riyals ($25.6 billion) and the company a potential market value of between $1.6 trillion and $1.7 trillion.

“We are planning to subscribe to the IPO in two funds that we manage,” said Zachary Cefaratti, chief executive officer of Dubai-based Dalma Capital Management Ltd, who also stated that the preliminary valuation was “in line with our expectations”.

(Reference: Reuters, Business Insider)