By Innovation-sa on November 10, 2019 in News

Saudi Arabia’s oil giant, Saudi Aramco kicked off an oft-delayed domestic initial public offering (IPO) on Sunday, revealing potential tax cuts and dividends to lure investors. With an annual net income of $111 billion in 2018, the world’s most profitable firm has announced plans to sell 1 billion shares to private investors – Saudi nationals, qualifying resident expatriates, and GCC citizens – in the record breaking IPO.


Currently, Aramco owns 200 billion shares of which 0.5 percent shares have been listed for sale. Private investors who buy shares in the IPO, and who hold them for a period of six months after trading begins in December, will receive bonus shares up to a total of 100 shares, said the 658-page formal prospectus.


Crown Prince Muhammad bin Salman has long insisted the state oil company is worth $2 trillion and is expecting to attract investors to take part in what is expected to be the world’s biggest IPO.


Saudi Arabia is undergoing a major economic transformation and the decision to push Saudi Aramco towards a stock market debut was one of the most ambitious initiative by the Crown Prince. The state energy giant is looking forward to list 2 percent of the company on the Saudi bourse, raising as much as $20 billion – $40 billion, instead of the entire share capital.


Saudi’s have been saving up to invest in the kingdom’s most important asset and most Saudis see the sale of shares in their national giant, Aramco, as a demonstration of loyalty. The state oil company’s roadshows will begin on November 18, with pricing scheduled for December 5 and shares expected to start trading on December 11.


The Kingdom’s market regulator, Capital Market Authority (CMA), said that it has issued a resolution approving Saudi Aramco’s IPO which will be valid for six months from the CMA Board resolution date.