Environmental groups warn banks over Saudi Aramco

A logo sits on display on the side of a crude oil storage tank at the Juaymah tank farm at Saudi Aramco's Ras Tanura oil refinery and oil terminal in Ras Tanura Saudi Arabia on Monday Oct. 1 2018

Saudi Aramco likely to delay IPO

While details of the proposed offer haven't been made public, people involved in the transaction said earlier this month that about 2 per cent of Aramco might be sold, raising US$40 billion and easily exceeding the US$25 billion raised in 2014 by Chinese e-commerce giant Alibaba Group Holding Ltd. So now the firm was hoping to reassure nervous investors by publishing positive results covering that tricky period. However, they have also expressed doubt over the company's valuation. Neither source knew when third quarter results were likely to come out.

"They want to do all what they can to hit valuation target, solid results after the attack will give them a stronger position", one of the sources told Reuters. On the other hand, the Financial Times wrote the listing will be delayed by "weeks". The banks are still struggling to meet the US$2 trillion valuation the company is seeking, according to the person.

Saudi Aramco's initial public offering (IPO) could be the biggest stock sale in the world even if the oil company is planning on floating only 5 percent of its assets. "The company is ready and timing will depend on market conditions and be at a time of the shareholders' choosing".

The company is planning to float a 1% to 2% stake in the Tadawul market before the worldwide listing.

Last year, Aramco delayed the IPO after more than two years of preparations as global investors balked at the US$2 trillion valuation Crown Prince Mohammed bin Salman had put on the company. The recent attack on company's Khurais and Abqaiq plants results in the reduction of half the initial crude oil output. The full restoration of oil output as declared by Energy Minister Prince Abdulaziz bin Salman on October 3 - at a faster clip than expected - was seen boosting the company's image.

They were given impetus by the appointment of Yasir al-Rumayyan, a close ally of Prince Mohammed and former investment banker, as chairman of Aramco.

Latest News