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Saudi Aramco Raises $25.6bn in the World's Biggest IPO Ever

Professor of Financial Economics and Part-time Value Investor, Transfin.
Dec 12, 2019 5:17 AM 2 min read
Editorial

Energy giant Saudi Aramco raises $25.6bn in the world's biggest IPO ever.

 

SAUDI ARAMCO

Saudi Aramco raises $25.6bn in the world's biggest IPO ever.

Raising A Fortune: Energy giant Saudi Aramco has raised a record $25.6bn in its initial public offering in Riyadh. 

 

The share sale was the biggest to date, surpassing that of China's Alibaba which raised $25bn in 2014 in New York. The IPO will value it at $1.7tn when trading begins - short of its $2tn target, but making it the most valuable listed company in the world. Aramco’s shares are scheduled to start trading Dec 11 on Saudi Arabia’s Tadawul stock exchange. 

 

Hit Refresh: Aramco - the world’s most profitable company - has found the journey to its public offering rather testing. Aramco had initially sought to raise $100bn on two exchanges - with a first listing on the kingdom's Tadawul bourse, and then another on an overseas exchange such as the London Stock Exchange. But it scaled back its plans after foreign investors raised questions over the valuation, venue for an international listing, political risk and a lack of corporate transparency, among other things. WSJ

 

However, bigger challenges await the giant. Analysts believe the biggest challenge for the company will be if it decides to list on an international stock exchange in the future to expand its investor pool. Demand for crude has been falling, which could make it difficult for the company to grow in the long term. The climate crisis and geopolitical risks are also key factors that could deter potential investors. BBC News

FIN.

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