Saudi Aramco valued at $1.7 trillion ahead of flotation

State-owned oil giant hopes to raise $25 billion in stock market debut

Oil giant Saudi Aramco has valued itself at $1.7tn (£1.3tn, €1.5tn) ahead of potentially the world’s biggest initial public offering next month.

A statement from the company set the price range at $8-8.5 a share, which would value the IPO at $25.6 billion at the top of the range. With three billion shares up for grabs, that would beat the previous record for an IPO of $21.8 billion raised by Chinese e-commerce business Alibaba in 2014.

The valuation is well below the $2tn target set by Crown Prince Mohammed bin Salman, with many international investors steering clear of the IPO for now.

Western investors are thought to be concerned about the company’s state ownership and geopolitical volatility in the Middle East. Some were also put off by the IPO’s listing on Riyadh’s Tadawul exchange rather than a major international equivalent.

Last week the company released a prospectus that warned of investment risks including terrorist attacks and climate change. Two of the company’s facilities were hit by a drone attack in September, temporarily halving the crude output of the world’s largest oil exporter.

What is your sentiment on Oil - Crude?

Vote to see community's results!

The lukewarm response from Western investors has forced the company to focus on Middle Eastern institutional investors and ultra-high-net-worth individuals. Around 0.5 per cent of shares have been earmarked for Saudi retail investors.

Saudi Aramco will reveal the final share price early next month, though it has yet to confirm a date when shares will begin to trade.

FURTHER READING: Long-awaited listing of oil giant Aramco announced

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
iPhone Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image