Saudi Aramco said to mull discounted shares for citizens

Saudi Arabian Oil Co. (Saudi Aramco), which is preparing for initial public offering in 2018, might offer shares at discounted price to the kingdom’s citizens, Bloomberg reported, citing unnamed people familiar with the matter.

The oil giant has talked about methods to structure the sale so that retail investors in Saudi Arabia can buy shares for less than those sold on international exchanges, the people said.

Aramco is looking at listing its shares in the US, UK and Asia, in addition to Riyadh, and plans on choosing local banks to advise on the Saudi listing, the people said.

No final decisions have been made on the share pricing or listing venue, they said.

Saudi Arabia is planning to sell shares in Aramco as it works to reduce its dependence on oil revenues. The sale could value Aramco at more than $2 trillion, Saudi officials have said.

Shares in companies owned by the Saudi government have traditionally been offered at a nominal value, about SAR 10 ($2.67) each, as a way for the state to redistribute wealth to the population, Bloomberg said.

The country’s stock market regulator last year approved rules to allow foreign investors to subscribe to IPOs in the kingdom starting in January, which allows book-building in listings for those who qualify. Book building prices shares based on demand, it added.