When will Saudi Arabia launch Aramco IPO?

The most important question asked by all investors worldwide - especially in Saudi Arabia - is when the initial public offering (IPO) of Saudi Aramco will take place.

Given the massive importance of the long-awaited IPO and strong investor interest, a series of reports and forecasts have been recently issued about the expected share sale date and stake size in the local and international markets.

The planned IPO of the giant oil producer and investor anticipation of the offering date and size have undoubtedly become the world’s most-awaited event.

Out of its keenness to publish reliable and accurate information, Argaam has reached out to the state-owned Saudi Aramco officials to inquire about the matter, but they have declined to comment at this time.

Last month, Saudi Aramco’s chairman Yasir Al-Rumayyan said Saudi Arabia will carry out within the next 12 months the planned IPO of the world’s largest oil producer, based on the company’s readiness and market conditions.

Minister of Energy Prince Abdulaziz bin Salman said the Kingdom, after turning page on the drone attacks on Aramco’s oil facilities, wants to make sure that the offering will be a successful IPO.

The giant oil producer has recently announced a plan to pay dividends at $75 billion (SAR 281.25 billion) for 2020. Aramco added it is also planning a progressive growing dividend on sustainable basis later on.

Following are the main reports published by foreign news agencies on Saudi Aramco’s IPO:

- On Oct. 10, Bloomberg reported that Aramco is set to make a formal announcement about its planned IPO in late October. Citing sources with knowledge of the matter, Bloomberg added the company is planning to announce the intention to float around Oct. 20, expecting Aramco shares to debut in Tadawul in early November.

The news agency then said no final decision has been taken, adding that the share sale depends on market conditions and investor demand.

- The Wall Street Journal (WSJ) said that Saudi Aramco will issue its prospectus by the end of October, citing unnamed sources.

It added the Arabic and English prospectus will be issued on Oct. 25 and 27, respectively. The book-building process will take place in November.

An assessment will be conducted for the book-building process and offering price. A final decision will follow on floating one or two percent of Aramco’s shares in the Saudi market this year.

- Reuters reported that the Saudi Arabian Monetary Authority (SAMA), the Kingdom’s central bank, contacted Saudi banks last week, asking them a series of questions about their lending exposure to Aramco ahead of an IPO of the state-oil giant that will likely see large numbers of Saudi investors seek loans to buy its stock.

According to Reuters unnamed sources, up to 6 million to 7 million local investors are likely to subscribe to Aramco’s shares.

It is worth noting that the Capital Market Authority (CMA) has warned against dealing with unreliable persons, scam websites, spam callers, and anonymous text messages that market for investing, trading and fund raising without licensed from competent authorities.

The warning came in response to the emergence of fake accounts that call on retail investors to take part in Aramco’s imminent IPO.