Imbroglio about the gigantic IPO of the Saudi Aramco oil company

CFour top sources in the oil sector, the news agency Reuters announced on 20 August that the IPO transaction of the Saudi Aramco group had been frozen. The international news agency had also added that this IPO would be suspended, both in terms of listing in Riyadh and at a foreign exchange.

Announcements on which Khaled al-Faleh, the Saudi Minister for Energy and the management of the oil group refute. Khalid al Falih, director of the executive committee Saudi Aramco explains in a statement: " The government remains committed to the IPO of Saudi Aramco, depending on the right circumstances and the right timing chosen by the government ".

The Saudi Minister for Energy adds that Ryad has taken steps to prepare for this operation and that the timing of the implementation depends on various factors, including favorable market conditions, and a proposed acquisition during the coming months in the downstream part of its oil business.

Reasons for doubt

Since the announcement in 2016, the sale of a minority stake in Aramco has been postponed several times. The government company executives have formally called unfavorable conditions on the financial markets to postpone the launch this year. This has led analysts to doubt whether it really takes place. Doubts reinforced by Reuters information.

Experts doubt that Aramco can be estimated at $ 2 trillion, as desired by the crown prince. And the company seems reluctant to undergo a thorough audit because a possible IPO is required, which would explain the delays of the operation.

" The decision to cancel this IPO has been taken a while ago, but no one can publicly admit it, so the statements will gradually go in this direction: first a postponement and then abandonment Told Reuters, a Saudi source, informed about the IPO project.

"Strategic participation"

The international news agency also reported that Saudi Arabia had abandoned the IPO of Aramco to focus on strategic participation » of the company with the capital of Saudi Basic Industries Corporation (Sabic). This petrochemical group – number four worldwide in its sector – is the largest listed company in the financial market of Ryad with a capitalization of approximately 100 billion dollars (85 billion euros).

To date, Saudi Aramco has not responded to e-mail requests from Reuters and the Royal Palace has still not communicated on the subject. The Ministry of Energy has not yet provided any details about the assets in question.

The CEO of Aramco, Amine Nasser, confirmed in July the existence of prior discussions for a stake in Sabic, 70% owned by the Saudi Kingdom Government Investment Fund (PIF).

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