State-owned oil giant Saudi Aramco is worth up to $1.7 trillion in a new IPO range, setting the stage for the world's largest public listing

REUTERS/Hamad I Mohammed/File PhotoAmin H. Nasser, president and CEO of Aramco, and Yasser al-Rumayyan, Saudi Aramco’s chairman, attend a news conference at the Plaza Conference Centre in Dhahran, Saudi Arabia this month.
  • State-owned oil giant Saudi Aramco on Sunday released a range for its initial public offering that places its valuation up to $US1.7 trillion ahead of its public debut that’s expected to be the largest on record.
  • The statement published on Sunday to Aramco’s website marks a milestone in the company’s closely watched path to the public market.
  • The company filed a key document last week detailing risks to its operations like climate change and terrorism, armed conflict, and political unrest in the region.
  • Aramco is expected to begin publicly trading next month on Saudi’s stock exchange, the Tadawul. Saudi Arabia’s leader, Mohammed bin Salman, has said he belives the company is worth $US2 trillion.
  • The crown price’s kingdom has come under scrutiny for journalist Jamal Khashoggi’s murder inside the Saudi consulate in Istanbul last October. Bin Salman said in a September interview with CBS News that he takes “full responsibility” for Khashoggi’s murder, but denied that he ordered it.
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State-owned oil giant Saudi Aramco on Sunday released a range for its initial public offering that places its valuation up to $US1.7 trillion ahead of its public debut that’s expected to be the largest on record.

Aramco said it planned to sell a 1.5% stake in itself to investors, or some 3 billion shares. The Saudi Arabia-run company is targeting a price range of 30 to 32 Saudi riyals, or around $US8.00, per share.

Aramco, the world’s most profitable company with $US111 billion in 2018 net income, is expected to begin publicly trading next month on the Tadawul, Saudi’s stock exchange. The statement published on Sunday to Aramco’s website marks a milestone in the company’s closely watched path to the public market.

Investors in the US and other countries cannot directly buy Aramco’s shares. Though even as corporate leaders decry Saudi Arabia’s part in the 2018 murder of journalist Jamal Khashoggi, accessing the kingdom’s broader market has become easier than ever before.

The global index provider MSCI folded Saudi Arabian stocks into its emerging markets index earlier this year. Meanwhile the largest US investment banks are among those underwriting Aramco’s IPO. Citi, JPMorgan, and Goldman Sachs are among the joint bookrunners with more than 20 firms underwriting the listing.

Zachary Cefaratti, the chief executive officer of Dubai-based Dalma Capital Management, told Reuters on Sunday that his firm planned to subscribe to the IPO through two funds. Cefaratti said Aramco’s preliminary valuation fell in-line with his expectations.

Mohammed bin SalmanREUTERS/Amir LevySaudi Arabia’s Crown Prince Mohammed bin Salman.

Last week, Aramco filed a key document detailing risks to its operations like climate change and terrorism, armed conflict, and political unrest in the region.

The latest valuation comes as Saudi Arabia’s leader, Mohammed bin Salman, has previously pegged the company’s worth at $US2 trillion.

The crown price’s kingdom has come under scrutiny for Khashoggi’s murder inside the Saudi consulate in Istanbul last October, prompting an international outcry.

Bin Salman said in a September interview with CBS News that he takes “full responsibility” for Khashoggi’s murder but denied that he ordered it.

“Investors have been staying out of Saudi Arabia because of the reputation risk since the Khashoggi debacle as well as concern that Aramco will swamp the market,” Steve Holden, the CEO of Copley Fund Research, said in a report earlier this month.

Saudi Arabian equities comprise the third-lowest global investment allocation relative to its weighting in MSCI’s emerging markets index, per a Copely analysis. Some 87% of emerging-market funds have no exposure.

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