KHALEEJ TIMES, Wednesday, Sep 11, 2019 | Muharram 12, 1441
Aramco ready for two-stage $100b IPO
Saudi energy giant, Aramco, is set for a two-stage $100 billion stock
market debut by floating around five per cent of the company in what could
potentially be the world's biggest stock sale, its CEO said on Tuesday.
Amin Nasser, who is also the president of the world's largest oil company, said
that the impending stake sale of the state-owned company on international
markets would complement a planned domestic initial public offering.
The IPO could be in 2020 or 2021, he said, adding that the ultimate decision on
the venue and timing of the flotation rested with the Saudi government. "As you
heard from His Royal Highness Prince Abdulaziz (the new Saudi Energy minister)
yesterday, it is going to be very soon. So, we are ready."
"The primary listing is to list locally but we are ready also for listing
outside in other districts," Nasser said, but did not specify which other
locations are under consideration.
The IPO aims to raise up to $100 billion based on a $2 trillion valuation of
Aramco, but investors have debated whether the company is worth that much and
there have been repeated delays in the launch originally envisaged for 2018. The
Saudi government has not given any explanation for the delays, but apart from
holding out for the big-ticket valuation they are also said to be concerned the
IPO could bring intense legal scrutiny of the secretive company's finances and
corporate inner workings.
According to reports, Aramco was considering a two-stage process with a domestic
debut and a subsequent international listing - possibly in Tokyo.
"One of the primary listings is going to be local but we are also ready for
listing outside," Nasser confirmed.
He told the World Energy Congress in Abu Dhabi that oil and gas will remain at
the heart of the global energy mix for decades to come and that Aramco was also
taking steps to meet the climate challenges.
Abu Dhabi is also hosting this week a meeting of the Joint Ministerial
Monitoring Committee of the Opec+ alliance for a supply cut deal reached last
Meanwhile, India's oil minister said the planned giant refinery and
petrochemical project, which is being built with Saudi Aramco and Abu Dhabi
National Oil Co, will cost more than the originally planned $45 billion. The 1.2
million barrels-per-day giant coastal project is part of India's plans to raise
its refining capacity by 77 per cent to 8.8 million bpd by 2030. It is being
built at Roha, around 100 km south of Mumbai.
"The primary plan was around $45 billion, it will be more than that," Dharmendra
Pradhan told reporters at the World Energy Congress, declining to say by how
Reports said that India had increased the cost estimate of the project by more
than 36 per cent after protests by farmers forced its relocation. Some sources
estimated that the project would cost $60 billion, but is still expected to be
commissioned in 2025.