Saudi Aramco has announced that its shares will be priced between $8 (SAR 30) and $8.50 (SAR 32) per share, placing the company’s valuation between $1.6trn and $1.7trn. Crown Prince Mohammad bin Salman had sought a valuation of $2trn, but reportedly said he was willing to settle at a lower valuation.
The company will list 1.5% of its shares, amounting to 3bn shares, on the Saudi exchange (Tadawul), and it appears that plans for a potential international listing have been shelved for the moment. The Financial Times reported that the company would only list shares on Tadawul, citing anonymous sources.
International investors have balked at the $2trn valuation sought by the crown prince, and even the revised valuation. A valuation at the $1.5trn mark would provide a return on investment closer to those offered by other international oil majors.
At the higher end of the price range, the listing would raise up to $25.5bn, a far cry from the original plan to raise $100bn. At the $8 per share mark, the listing would raise just under $25bn, the current world record for the largest IPO, raised by China’s Alibaba Group Holding in 2014.
