As Saudi Arabia appears to actively consider a potential IPO for its state-owned oil company, Saudi Aramco, two conflicting reports emerged today about the potential scope of the offering.
On Thursday of last week, Saudi Arabia’s deputy crown prince Mohammed bin Salman told the Economist in an interview that he was optimistic about the potential listing of saudi Aramco in “the next few months.
“Personally I’m enthusiastic about this step,” he said. “I believe it is in the interest of the Saudi market, and it is in the interest of Aramco.”
But according to a Reuters report today, Saudi Arabia is considering selling shares in refining ventures with foreign oil firms, not shares in the parent company. The company would not offer a stake in the crude oil exploration and production operations. Reuters cited an unnamed source.
However, another report in the Wall Street Journal, citing comments from Aramco’s chairman Khalid al-Falih, said shares in its state-owned oil giant could include listing at least part of its exploration and production assets.
“We are considering a listing at the top. So a listing of the main company, and obviously the main company will include upstream,”
While the scope of a potential listing is still under consideration in Saudi Arabia, banks around the world are scrambling to prepare the lucrative offering for the Kingdom.
According to the FT, analysts value the entire company as high as $10 trillion, “so it is easy to see why the deal has whetted the appetite of investment banks who saw their industry’s fees fall 8 per cent last year despite the mergers and acquisitions boom.” However, the actual deal is likely to be “smaller than the headlines suggest.”
