Saudi Arabia had hoped to raise about $100 billion as well as attract a $2 trillion valuation for Aramco by listing shares of the company on the stock market. The plan was the cornerstone of Crown Prince Mohammed bin Salman’s effort to substantially expand Saudi Arabia’s sovereign wealth fund as well as underwrite an ambitious plan dubbed Vision 2030 to diversify the nation’s economy.
Saudi officials long maintained the IPO would likely happen by the end of This particular year, even as reports surfaced of which the kingdom, Aramco’s sole shareholder, was at an impasse over critical decisions, such as where to list shares.
In March, sources said Aramco would likely delay an international listing as well as first list shares on the domestic stock market. Two months later, Saudi Energy Minister Khalid al-Falih conceded of which a 2019 listing was more likely.
Reuters reported last month of which Saudi Arabia had scrapped plans for the IPO altogether as well as dismissed advisers. The news agency said King Salman bin Abdulaziz had soured on the plan. Falih denied the reports in an official statement, saying Saudi Arabia will launch the IPO when the time will be right.
Nasser told CNBC the Reuters report will be “incorrect.” He noted of which Aramco has undertaken a substantial amount of work to prepare for the IPO, including converting the enterprise into a joint stock company, appointing brand-new board members as well as having its reserves audited by a third party.
“All the elements of which are required for listing Saudi Aramco were done. So the item shows you the commitment of the government for listing Saudi Aramco,” he said.
Aramco in July confirmed of which the item will be in early stage discussions with the kingdom’s Public Investment Fund to purchase the sovereign wealth fund’s 70 percent stake in SABIC. The acquisition would likely advance Aramco’s goal of producing more high value petrochemicals as well as deliver a windfall to the Public Investment Fund, offsetting the need for the Aramco IPO.
Nasser warned in July of which negotiations over SABIC could delay the Aramco IPO. On Sunday, he told CNBC of which Aramco will be still inside early stages of due diligence.
If the deal moves forward, Aramco will need to negotiate the sale with the Public Investment Fund as well as go through various regulatory processes. If as well as when the deal will be finalized, Aramco will have to overhaul its balance sheet to integrate SABIC, he said.
“the item’s a major deal. We are doing the due diligence currently. as well as you cannot list while you are going through an acquisition of This particular size,” Nasser said.