June 13, 2024
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Saudi Arabia Set to Launch Secondary Share Sale of Aramco

Saudi Arabia is expected to initiate a secondary share sale in its oil giant Aramco as early as Sunday, according to sources cited by Reuters on Thursday.

This landmark new share offering awaits final approval from Saudi Crown Prince Mohammed bin Salman, the sources added. Reports emerged last week that Aramco planned to sell more shares soon, potentially as early as next month.

The news was first reported exclusively by Reuters, which mentioned two unnamed sources suggesting such plans. One source indicated that the sale could generate around $10 billion for Aramco.

“Decisions about share sales are matters for our shareholders and are not something we are able to comment on,” the company stated in response to the report.

Currently, Saudi Arabia owns just over 98% of Aramco after selling 1.7% in the initial public offering (IPO) in December 2019. Of the 98% held by the Kingdom, the Saudi government owns 90% of Aramco, while the sovereign wealth fund owns the remaining 8%.

Initially, the Saudis aimed to list Aramco on the Saudi stock exchange, Tadawul, and on one major international market, with London, New York, Tokyo, and Hong Kong all being considered. However, due to tepid investor demand and potential legal risks, especially with a New York listing, the IPO plans were scaled back.

Aramco debuted on the Saudi Stock Exchange in December 2019, raising around $30 billion in what became the largest share listing in history.

Since the IPO, Saudi leaders, including Crown Prince Mohammed bin Salman, have repeatedly indicated that there would be more Aramco share sales on Tadawul in the future.

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