Aramco IPO on track for 2020-21, says Saudi crown prince

Saudi Arabia is committed to listing its state oil producer Saudi Aramco between 2020 and 2021 depending on market conditions, according to Crown Prince Mohammed bin Salman.

"We are committed to the Aramco IPO, given favourable conditions and the right time, and as I said before we expect that between 2020 and 2021,” he told Arabic daily Asharq Al Awsat.

Aramco, the world’s largest oil exporting company sells crude on behalf of the kingdom. The producer emerged as the most profitable company in 2018, beating the likes of tech giants Apple and Google. Aramco made $111.1 billion (Dh408bn) in net income and had earnings before interest, tax, depreciation amortisation of $224bn last year.

The 5 per cent listing of Aramco is a critical linchpin in Prince Salman’s Vision 2030, which seeks to diversify the kingdom’s economy. An initial public offering is expected to fetch as much as $100bn in proceeds for Saudi Arabia based on the government's $2 trillion valuation of Aramco.

However, the merger of Aramco with Saudi Basic Industries Corporation, the region’s largest-listed chemicals company, delayed the IPO. The oil giant acquired a 70 per cent stake in Sabic in a $69.1bn deal in March.

Aramco then issued a $12bn bond, appetite for which topped $100bn in April. Demand for the issue was the largest for emerging markets since an order book value of more than $52bn for Qatar's $12bn bonds last year, and surpassed $67bn in demand for Saudi Arabia's inaugural bonds in 2016.

Aramco received the fifth-highest ratings from Fitch Ratings and Moody's Investors Service ahead of the issuance.

Moody's assigned Aramco an A1 credit rating while Fitch gave it A-plus.

Aramco will hold its first earnings call in August to discuss its half year performance.

The state producer shared its annual results last week in a new investor relations section on the company website, ahead of its half yearly presentation scheduled for August.

Source: The National