Saudi Aramco sells shares for USD 12 billion
Saudi Arabia has announced it will sell 1.545 billion shares in an expected price range of 26.70 to 29 riyals ($7 to $7.70), representing about 0.64 per cent of the company's issued shares. The sale will begin on Sunday, 2 June for institutional investors and Monday for retail investors.
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New share sale for Saudi Aramco, following the 2019 mega-listing. Saudi Aramco has in fact announced that it intends to sell 1.545 billion shares with an estimated value of up to USD 12 billion. In a statement, Aramco announced that the expected price range will be between 26.70 and 29 riyals ($7 to $7.70). The shares will be offered to local as well as foreign investors. The sale on the Saudi Stock Exchange, which accounts for about 0.64% of the company's issued shares, will begin on Sunday, 2 June, Aramco said, for institutional investors and Monday for retail investors.
This is the company's second IPO after the initial public offering in December 2019 that raised $25.6 billion, the largest IPO in history.
Quoted by the Financial Times, CEO Amin H. Nasser explained that the timing of the sale is being decided by the government, but added that it is still an opportunity to broaden the international investor base. The final decision on the details, again according to the British newspaper, is expected to be made by Crown Prince Mohammed bin Salman and the main beneficiary of the sale is expected to be the kingdom's sovereign wealth fund, the Public Investment Fund.
The offer is part of a multi-year plan to divest shares in the oil giant, with the aim of reducing its dependence on oil. On 7 May, Saudi Aramco had released figures for the first quarter of the year, showing net profit (USD 27.3bn) down (USD 31bn) from the same period in 2023. Free cash flow was 22.8bn (whereas it had reached 30.9bn in Q1 2023). The company expects total dividends of $124.3bn to be declared in 2024, including the base dividend of $81.2bn and the performance-related dividend of $43.1bn (last year, Aramco had paid almost $100bn in dividends).
"We also continue to execute our long-term strategy, and in the first quarter we made significant progress in expanding our gas business," said President and CEO Nasser. "Looking ahead, I expect our portfolio to continue to evolve as we aim to contribute to an energy transition that offers solutions to climate challenges, but at the same time recognises the need for affordable, reliable and flexible energy supplies.
