BY Fraser Tennant
In what ranks as the world’s biggest initial public offering (IPO), the Saudi Arabian Oil Company (Saudi Aramco) has officially listed on the Saudi Stock Exchange (Tadawul), its stock jumping 10 percent in market value to $1.88 trillion.
Shares closed at 35.2 riyals each, up from the IPO price of 32 riyals and at the daily limit of price moves allowed by the Tadawul exchange. Furthermore, the IPO process, which concluded on 4 December 2019, generated more than five million subscriptions by institutional and individual subscribers.
Saudi Aramco’s listing and share trading debut was marked by a symbolic ringing of the Tadawul bell by his Excellency Yasir Othman Al-Rumayyan, chairman of the board of directors, and Amin H. Nasser, president and chief executive.
“This is a proud and historic moment for Saudi Aramco and our majority shareholder, the Kingdom,” said His Excellency. “Saudi Aramco is beginning life as a listed company on Tadawul, together with all our new individual and institutional shareholders here in the Kingdom, in the region and around the world.
“My focus, and that of our board of directors, is to work in the interests of all shareholders, guiding Saudi Aramco as it continues to fulfil its vital role in global energy supply, while striving to create long-term value to benefit all shareholders,” he continued. “Our approach is underpinned by a disciplined capital allocation process and a highly experienced senior management team.”
A state oil company with a rich history, Saudi Amarco’s presence in the Kingdom dates back to 1933.
“Our success since that time is based on the strong foundation and values created by our pioneers and reinforced by subsequent generations of Aramcons,” said Mr Nasser. “Today, that foundation, those values and this legacy are being carried forward by my colleagues around the world.”
Going forward, by building on its low-cost production and reliable supply of low carbon-intensity crude oil to its customers, Saudi Amarco has pledged to remain focused on providing its shareholders with resilient value creation through crude oil price cycles.
His Excellency added: “The IPO underlines the Kingdom’s commitment to nurturing a strong capital market and demonstrates further significant progress in delivering Vision 2030 – the Kingdom’s transformation, economic growth and diversification programme that continues with pace and determination.”