Saudi Arabia’s Minister of Energy, Industry and Mineral Resources Khalid Al Falih has suggested the initial public offering (IPO) of state oil major Saudi Aramco, of which he is Chairman, could be held back until 2019, potentially delaying a key component of Crown Prince Mohammed bin Salman’s aims to diversify the kingdom’s economy, according to Bloomberg.
Al Falih also stated the IPO, which ultimately might be the world’s largest, would be “anchored” by a listing on Saudi Arabia’s local Tadawul exchange and international listings would be rolled out in due course, if at all.
“Between December 31 and January 1 there is no value lost for the kingdom,” Al Falih said in an interview with the news agency in London. “So, I don’t see this artificial deadline that you refer to as being significant.”
Thus far in 2018, the IPO has been slated for taking place later in the year and all preparations were being geared up for this eventuality. However, speculation has recently appeared about where the firm would float amid concerns the local bourse would not be big or diverse enough to cope with it.
"The only certain thing about the Saudi Aramco IPO is that a) it will happen, b) the anchor market will be the Tadawul exchange in Saudi Arabia,” Al Falih said. “We have created the framework - fiscal and otherwise regulatory - for Saudi Aramco to be listed this year. The actual timing will be announced when we feel that the conditions for the success of that listing are in place.”
The IPO is crucial to Prince Salman’s economic programme known as Vision 2030. The kingdom hopes it will raise $100bn by selling 5% of the company, which would value Aramco at $2trn.