After several delays, Saudi Arabia has finally decided to freeze the IPO of its national oil company.
It must have been the quote of the century. Faced with recent years with a drop in oil revenues and increases in social spending that caused a budget deficit, Saudi Arabia announced early 2016 the initial public offering of its domestic oil company Saudi Aramco. This colossal financial operation was frozen, Reuters said and quoted Wednesday & # 39; four top sources in the oil sector & # 39 ;.
According to these sources, Saudi Arabia has separated itself from the financial advisors working on the transaction, because it now focuses on a project of "strategic participation" by Aramco in the capital of the petrochemical group Saudi Basic Industries Corporation (Sabic), world number four in his sector.
Roll out the red carpet for the Saudi giant
It was stated that 5% of the capital of Aramco was originally introduced on the market. The Financial Times, referring to various sources, had mentioned a valuation of 2000 billion dollars at the beginning of the year. That is double the current market capitalization of Apple, which has the record in the field. This is enough to induce the appetite of the financial centers of New York, London and Hong Kong, who are fighting to roll out the red carpet for the Saudi giant. The commercial banks were also busy near the company that was in Dhahran. JPMorgan, Morgan Stanley or HSBC have so far shared the advisory market.
Last spring, the Saudi Minister of Finance had suggested that the introduction of the national flagship could be postponed until 2019 if the market conditions were not favorable. The valuation of the giant, calculated on the basis of, among other things, crude reserves and the outlook for the oil market, would be subject to differences. Some assurance, the decision could not be taken without the approval of the almighty crown prince Mohammed Ben Salman, the pilot of the modernization of the economy of the kingdom.