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Saudi Aramco Sets $1.7tr Valuation; At $25.6bn, IPO Could Be Biggest in History

Professor of Financial Economics and Part-time Value Investor, Transfin.
Nov 18, 2019 11:12 AM 2 min read

Saudi Aramco sets $1.7tr valuation. At $25.6bn, IPO could be biggest in history.



Saudi Aramco sets $1.7tr valuation. At $25.6bn, IPO could be biggest in history.

Aramco Has Arrived: Saudi Aramco has set a $1.6-$1.7tr valuation target. This is below the $2tr valuation sought by the Saudi Crown Prince but still in the running to become history's biggest IPO.


Oil Be Buying Aramco Shares: The world's most valuable company plans to sell about 3bn shares at an indicative price range of 30-32 riyals. Selling 1.5% of the oil giant would value the IPO at about $25.6bn, above the $25bn Chinese e-commerce giant Alibaba raised in its record-setting 2014 New York IPO. Moneycontrol


The More You Know: Aramco sits on 260.2bn barrels of oil equivalent in 2017, larger than Exxon Mobil Corp, Chevron Corp, Royal Dutch Shell Plc, BP Plc and Total SA combined. Its production cost is the world's lowest, and it pumps 10% of the world's oil supply. More facts and stats about Saudi Aramco can be read here. Reuters


What If: Besides investor apprehensions over its valuation and threats of terror attacks on oil facilities, a major concern hanging over Saudi Aramco is existential in nature. The tide of history is shifting slowly but surely against oil companies. As the world embraces renewable and cleaner alternatives to energy and awareness about climate change spreads, the public's perception of oil has changed drastically. Twenty years ago, investors would have tripped over each other to buy the shares of a colossus like Aramco. It’s a much tougher sale now. BBG



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