Saudi Aramco to restart preparations for $2trn IPO
Saudi Arabia is restarting preparations for a initial public offering of oil giant Aramco, months after putting the planned listing on hold, with the kingdom's energy minister confirming plans for the listing to proceed in 2020 or 2021.
Saudi Arabia is reportedly in talks with international investors over an initial public offering (IPO) once it has completed a merger with the petrochemicals company Saudi Basic Industries Corp (Sabic).
"Bankers previously involved in the IPO are pushing for meetings with Aramco," sources told Reuters. "There is some shifting in terms of what roles the banks might have if IPO talks go ahead."
The IPO process was never suspended fully, we just took time to plan and work on the Sabic transaction for Aramco and then related to that of course was the bond offering. That is behind us"
JPMorgan, Morgan Stanley and HSBC were picked to play a leading role in the world's biggest ever IPO when the plan was first announced in 2016. Boutique investment banks Moelis & Co and Evercore were also hired by Aramco as independent advisers. But plans for a domestic and international listing were later postponed.
"The IPO process was never suspended fully, we just took time to plan and work on the Sabic transaction for Aramco and then related to that of course was the bond offering. That is behind us," Falih told reporters in Vienna. "We have always been clear that the IPO will happen in the 2020-21 timeframe. We never stopped talking about the IPO so now that all those issues have been cleared -- the Sabic transaction, the bond offering were extremely successful -- we believe we are ready to start planning the IPO," Falih said, adding that the timeframe of the IPO will hopefully announced "sooner rather than later."
The long-mooted IPO of up to 5% of Aramco's shares was to be the centerpiece of Saudi Arabia's Vision 2030 economic reforms. The revived IPO plan will still face significant hurdles, including the ability of the kingdom to achieve the $2trn valuation it's been seeking for the company.
Saudi Arabia's standing in the international investment community was dealt a blow last year after the killing of the journalist Jamal Khashoggi at the hands of Saudi agents.
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