(Rahnuma): Saudi Arabia put a valuation on state-owned oil giant Aramco of between $1.6 trillion and $1.71 trillion, well below the $2 trillion targets sought by Crown Prince Mohammed bin Salman since he first mooted an initial public offering in 2016.
Aramco will sell just 1.5% of its shares on the local stock exchange, the Tadawul, somewhat less than expected. At the lower end of the price range, the offer would fall short of a record, coming in just below the $25 billion raised Alibaba Group Holding Ltd.’s in 2014.
While the target valuation will make Aramco the world’s biggest public company by some distance, overtaking Apple Inc., the plans are a long way from Prince Mohammed’s initial aims: a local and international listing to raise as much as $100 billion for the kingdom’s sovereign wealth fund.
In a sign Aramco will rely heavily on local investors after receiving a tepid response from international money managers, the shares won’t be marketed in the U.S. and Canada as originally planned. Japan’s also off the list.
Aramco Chief Executive Officer Amin Nasser kicked off the IPO’s final phase at a presentation for hundreds of local fund managers in Riyadh. The roadshow is expected to move on to Europe this week.