The retail section of Saudi Aramco’s initial public offering (IPO) has been oversubscribed, with orders touching 38.1 billion riyals ($10.2 billion), lead manager Samba Capital said Thursday. The state oil titan plans to sell a 1.5% stake, i.e., 3 billion shares, and said at least one-third of the sale is anticipated to be covered by retail traders, who’ve until Thursday to enroll.
With an initial price of 30-32 riyals, the IPO is worth up to 96 billion riyals ($25.6 billion) and provides the agency a market value of $1.6-$1.7 trillion.
It is going to be the world’s most significant IPO if it tops the $25 billion recorded by China’s Alibaba back in 2014.
Approximately 4.17 million retail investors had subscribed to 1.19 billion shares by noon Thursday, injecting 6.13 billion riyals above the figure required for full coverage, Samba stated.
Subscription will proceed until midnight Thursday, and outcomes will be released on Friday, it mentioned in a statement.
The IPO is at the core of Crown Prince Mohammed bin Salman’s plans to shift the Saudi economy away from oil.
Aramco is the crown jewel of Saudi’s economy and the world’s most lucrative company.
It’s relying on local and regional demand to pull off the agreement, after canceling marketing roadshows outdoors the Gulf region due to a scarcity of interest from foreign institutional buyers.
Sources said this week that the sovereign wealth funds of Kuwait and Abu Dhabi plan to invest.
Saudis are keen to buy shares, with many seeking to take a position on behalf of their dependents to extend the number of shares they’ll buy.