Saudi Arabia is pulling out all the stops to ensure the success of Aramco’s initial public offering after Crown Prince Mohammed bin Salman finally decided to offer shares in the world’s largest oil producer, according to Bloomberg.
More than three years after the IPO was first mooted, Aramco published a so-called intention to float on Sunday, Nov. 3, the most dramatic change to the Saudi oil industry since the company was nationalized in the 1970s. The IPO is a cornerstone of Prince Mohammed’s Vision 2030 plan to make the Saudi economy ready for the post-oil era. Saudi Arabia is aiming for a valuation of between $1.6-$1.8 trillion, according to people familiar with the matter.
“This is the right time for us,” Chairman Yasir Al-Rumayyan said at a news conference at Aramco’s headquarters in the eastern city of Dhahran. Aramco’s net income last year of $111 billion made it the most profitable of any corporation – more than Apple Inc., Google’s parent Alphabet Inc., and Exxon Mobil Corp. combined – but the company has pledged to pay a minimum of $75 billion in dividends, leaving it vulnerable to a downturn in oil prices.