Bloomberg/Simon Dawson
Saudi government institutions invested almost $2.3 billion into the initial public offering (IPO) of Saudi Aramco, a transaction that was intended to find new sources of funding for the Kingdom’s economic diversification plan, reported Bloomberg.
The government sold two-thirds of the shares offered in the company to institutional investors, of which 13.2 per cent came from Saudi government institutions, according to a statement from Samba Capital, one of the lead managers on the deal. Non-Saudi investors were allocated 23.1 per cent of the institutional offering, or about $3.9 billion.
The public share was originally envisaged as a way to tap global equity investors and use the proceeds to fuel the sovereign wealth fund’s investment programme. After international investors balked at Saudi Aramco’s valuation expectations, the Kingdom instead focused on raising money domestically.
Mohammed Al Jadaan, the Saudi Arabia Finance Minister said that the Public Investment Fund expects to spend a considerable amount of the proceeds from the Saudi Aramco offering in the domestic economy as it shifts focus toward high-impact local investments.
Saudi companies were the biggest investors in the offering, buying 37.5 per cent of the shares offered to institutions. Public and private funds acquired 26.3 per cent of the institutional tranche.
MOST READ
BUSINESS
ING Groep plans to sell its Turkish unitBUSINESS
Bahrain considers stake sell in oil assetsBUSINESS
SABB seeks to boost corporate lendingBUSINESS
Egypt plans to resume IPOs of parastatalsBUSINESS
HSBC considering exiting from TurkeyBUSINESS
ADIA plans to sell a $2 billion stake in...BUSINESS
Turkish lira falls as regulator intervenesBUSINESS
Saudi unemployment dips to 12 per cent in Q3...BUSINESS
Dubai economy grew 2.1 per cent in H1 2019,...
CPI Financial was established in Dubai in 1999 to meet the needs of an ever-expanding financial community, offering a comprehensive portfolio of market-leading products and services tailor-made for the banking and financial services sectors.
Loading More post
