Picture: BLOOMBERG/CHRISTOPHER PIKE
Picture: BLOOMBERG/CHRISTOPHER PIKE

Dubai/Riyadh — Saudi Aramco aims to announce the start of its initial public offering (IPO) on November 3, people familiar with the matter have said, after delaying the  long-awaited listing of the world’s biggest company earlier in October to give advisers time to secure cornerstone investors.

The people also said Aramco’s CEO Amin Nasser was not present at the conference on Tuesday as he was meeting investors abroad ahead of the IPO.

Aramco is looking to float a 1% to 2% stake on the kingdom’s Tadawul (Saudi stock exchange) market, in what would be one of the largest ever IPOs, worth upwards of $20bn.

Market conditions

Aramco, in response to queries by Reuters, said on Tuesday that the oil company “does not comment on rumour or speculation. The company continues to engage with the shareholders on IPO readiness activities. The company is ready and timing will depend on market conditions and be at a time of the shareholders’ choosing.”

The people declined to be identified due to commercial sensitivities.

The company will soon have more shareholders from institutions, the head of the kingdom’s sovereign wealth fund, Yassir al-Rumayyan, said.

Al-Rumayyan, governor of the Saudi public investment fund (PIF) and chair of Aramco’s board of directors, was speaking at a panel at the conference in Riyadh. Aramco will start subscription for investors in its IPO on December 4, Saudi-owned news channel Al-Arabiya said in a news flash on Tuesday citing sources.

The oil giant plans to announce the transaction’s price on November 17, it added. The company will begin trading on the Tadawul on December 11, the broadcaster reported.

The prospect of Aramco selling a piece of itself has had Wall Street on tenterhooks since Crown Prince Mohammed bin Salman first flagged it three years ago. However, his desired $2-trillion valuation has always been questioned by some financiers and industry experts, who note that countries have been accelerating efforts to shift away from fossil fuels to curb global warming, putting oil prices under pressure and undermining producers’ equity value.

Russia’s sovereign wealth fund, the Russian direct investment fund (RDIF), is working on a consortium of investors for Aramco’s IPO, its CEO said.

“There are several Russian pensions funds that are interested in investing in the Aramco IPO, and we have also received indications from our Russia-China fund of some major Chinese institutions also interested in the Aramco IPO,” the RDIF head Kirill Dmitriev said on Tuesday.

Separately, Aramco has not approached the Kuwait investment authority (KIA) to invest in the IPO, the sovereign wealth fund’s MD Farouk Bastaki said on Tuesday. “The KIA has not been approached by Aramco or its advisers for the IPO, and the KIA will look at the IPO like any other investment,” Bastaki told reporters on the sidelines of the investment conference in Riyadh.

On Tuesday, Singapore Exchange’s CEO Boon-Chye Loh declined to comment directly on whether the exchange is in talks about a future international listing of Aramco in Singapore. “As an exchange that offers efficient access into almost 100% of Asia, we are as attractive as any other exchange for any other company looking for capital raising.” 

Reuters