Preparations for the public listing of Saudi state oil company, Aramco, have stepped up a gear this month but the signs are that it is unlikely to be the blockbuster sale that the Kingdom once hoped for. When plans for the listing were first mooted in 2016, Crown Prince Mohammed bin Salman targeted a 5% listing (partly on an international exchange) and a valuation of $2trn. But investor interest has not been as strong as expected and it now looks set to be a largely Saudi affair – a 1.5% stake sale on the Tadawul with a $1.6-1.7trn valuation and a heavy reliance on local investors. It’s now touch and go whether the sale will beat the record IPO of $25bn set by China’s Alibaba and the proceeds would barely cover the budget deficit for a year. And plans for this sale to be followed by an international listing seem to have lost momentum.
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