The world’s largest oil company, Saudi Aramco, is considered to have the largest bid in the world, according to the Wall Street Journal.
According to Saudi officials and “others close to the project,” Saudi Aramco plans to sell up to $50 billion worth of shares. If the Kingdom successfully executes this stock sale, it will be the largest stock sale in history.
The Kingdom has decided to hold any new Aramco offering on the Riyadh stock exchange to avoid regulatory risks associated with international listings, citing the report. Saudi officials and others familiar with the project.
Riyadh Stock Exchange Chosen for Listing
Saudi Aramco is the world’s largest oil company, with a market value of $2.25 trillion. Its shares are up 20% this year.
Some sources suggest that the Kingdom could hold the offer before the end of the year, although a final decision on the offer has yet to be made.
This isn’t the first time the oil giant has considered a stock market offering, but then backed out or at least reduced the offering from its ambitious plan.
Aramco’s Previous IPO Attempts and Current Financial Status
Saudi Arabia’s Crown Prince Mohammed bin Salman staked his reputation on Aramco’s massive IPO years ago, including a possible sale of NYSE shares – but scepticism about valuation and the risks related to the 9/11 terrorist attacks, the Justice Against Sponsors of Terrorism Act and Saudi Arabia’s reluctance to be transparent about production, exports, reserves, capacity, etc.
This prevented the national Saudi oil company from pursuing such a large offer, choosing to list in Tadawul only on December 11, 2019, when 1.5% of Aramco’s value began trading on Stock exchanges.
Although less than the 5% promised by the Crown Prince sales were still huge, generating $25.6 billion for the Kingdom and setting records.
The company, which is 90 per cent owned by the state of Saudi Arabia, said in a statement to the market that its profit was $30.1 billion for the April-June period, down 38%
The drop in profits reflects a drop in oil prices this year, following a sharp rise in oil prices following Russia’s invasion of Ukraine in February.
The jump helped Saudi Aramco reach a profit of $161 billion last year, the largest recorded by an oil company.