Saudi oil giant Aramco has announced that its base oil subsidiary, Luberef, has received a green signal from the kingdom’s stock market regulator to launch an IPO and list its shares on the main market of the Saudi Stock Exchange, which could raise about $1 billion.
A key Aramco unit, Luberef makes base oils used in lubricants for motor vehicles, ships and industrial machinery.
Following the CMA nod, Luberef will offer investors 50.045 million shares, which is equivalent to nearly 30% of its share capital by way of a sale of existing shares by Jadwa Industrial Investment Company, according to a Aramco.
The company has hired SNB Capital as lead manager, financial adviser, book-runner, global coordinator and underwriter. It also named Citigroup Saudi Arabia, HSBC Saudi Arabia, and Morgan Stanley Saudi Arabia as financial advisers, book-runners, global coordinators and underwriters.
A maximum of 12.5 million ordinary shares, representing 25% of the total offer shares, will be allocated to individual investors.
The Saudi oil giant clarified that it will not sell any of its shares in the offering and will continue to own 70% of Luberef’s share capital following the IPO.
The final pricing of the offer shares will be determined at the end of the book-building period, it stated.
Announcing the IPO plans, president and CEO Tareq Alnuaim said: “Luberef’s IPO supports its growth ambitions, and is expected to strengthen its already competitive business and unlock new opportunities for its stakeholders.
