Saudi Arabia officially launched its first public offering\nof state-run Saudi Aramco on Sunday, which will see a batch of shares on the\nlocal bourse hoping to raise billions of dollars to the kingdom.<\/p>\n\n\n\n
Initial plans call for the company’s shares to be traded on\nthe Riyadh Stock Exchange and later put other shares on foreign exchanges.\nPrince Mohammed hopes to reach a very optimistic assessment of $ 2 trillion\nfrom Aramco, which produces 10 million barrels per day of crude oil and\nprovides about 10% of global demand. This would generate $100 billion in\nrevenue for his ambitious plans to redevelop Saudi Arabia to secure new jobs,\nwith unemployment at over 10 percent.<\/p>\n\n\n\n
However, economic concerns and the trade war between China\nand the US and increased crude oil production by the US may lower energy\nprices. The September 14 attack aimed at Aramco has already frightened some\ninvestors, with one of the more popular rating companies lowered the oil\ngiant\u2019s value. The announcement issued by the Capital Market Authority did not\nprovide any timetable for subscription.<\/p>\n\n\n\n
“The Capital Market Authority board has issued its\nresolution approving the Saudi Arabian Oil Co. application for the registration\nand offering of part of its shares,” the statement said.<\/p>\n\n\n\n
Saudi-owned channel Al Arabiya said last week, citing\nanonymous sources, that pricing of shares would begin on November 17. The\nchannel said the final share price will be set on Dec. 4, with shares starting\ntrading on Dec. 11. The kingdom has in the past used the giant when it was\nstill an American company. But since the 100% purchase in the company before\n1980, the royal family is considered to be largely sole contribution, and did\nnot interfere with the company’s long-term business decisions. Its revenues\nprovide about 60% of all government revenues.<\/p>\n\n\n\n
Recently, however, there have been decisions that forced\nAramco to buy part of Saudi Basic Industries Corp. for $70 billion in a month\nbefore SABIC reported a quarterly profit decline.<\/p>\n\n\n\n
In its preliminary half-year results, Aramco reported\nrevenue of $46.8 billion. By announcing the IPO on Sunday, Prince Mohammed may\nbe convinced of a lower valuation for the IPO. The kingdom is likely to pin its\nhopes on the huge domestic interest in raising the value of the company before\nit is likely to take some shares abroad.<\/p>\n\n\n\n
Analysts believe Aramco will list up to 3% of the company in\ntrading, with another 2% being put abroad.<\/p>\n\n\n\n
Saudi Aramco has sought to reassure investors, given\nquestions about its valuation and the potential risks of future attacks or\ngeopolitical risks. The offer, posted on Aramco’s website last month, announced\nits intention to provide investors with a return of $75 billion in 2020.<\/p>\n\n\n\n
But unlike stocks, fears persist that Saudi Arabia could\nface other attacks such as the Sept. 14 attack, in which the United States\nblames Iran. Iran in turn denies launching missiles and drones used in the\nattack. The Houthi rebels have claimed responsibility, but analysts say the\nweapons used in the attack are difficult for the Houthis to own.<\/p>\n","protected":false},"excerpt":{"rendered":"
Saudi Arabia officially launched its first public offering of state-run Saudi Aramco on Sunday, which will see a batch of shares on the local bourse hoping to raise billions of dollars to the kingdom. Initial […]<\/a><\/p>\n<\/div>","protected":false},"author":1,"featured_media":1433,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[40,4,2],"tags":[93,42,36,34,114,120,48,24,78,131,41,44,95,72,45,109,115],"_links":{"self":[{"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/posts\/1432"}],"collection":[{"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/comments?post=1432"}],"version-history":[{"count":1,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/posts\/1432\/revisions"}],"predecessor-version":[{"id":1434,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/posts\/1432\/revisions\/1434"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/media\/1433"}],"wp:attachment":[{"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/media?parent=1432"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/categories?post=1432"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/skyeconomynews.com\/wp-json\/wp\/v2\/tags?post=1432"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}