(Bloomberg) -- Saudi Arabia is preparing to formally launch a secondary offering of shares in oil giant Aramco as soon as Sunday, a deal that could raise...
-- Saudi Arabia is preparing to formally launch a secondary offering of shares in oil giant Aramco as soon as Sunday, a deal that could raise more than $10 billion and rank among the largest of its kind in recent years.The government plans to run a book-building process to take orders until next Thursday, people familiar with the matter said, asking not to be identified as the information is private.
The kingdom is lining up a slate of banks including Citigroup Inc., Goldman Sachs Group Inc. and HSBC Holdings Plc for the deal, Bloomberg News has previously reported. Local firms including Saudi National Bank are likely to be involved, people familiar with the matter said, while Moelis & Co. has been acting as a financial adviser to help pick underwriters.
The deal comes at a crucial time for the kingdom, which holds an 82% stake in the $1.9 trillion firm. Crude oil prices are below the levels the government needs to balance its budget and Saudi Arabia has lagged behind its target of attracting more than $100 billion a year in foreign direct investment.
While the company’s massive dividend payouts may now be a draw, its shares are expensive with price-to-earnings ratios almost 50% higher than Exxon Mobil Corp. and double Shell Plc’s. The S&P 500 could plunge as much as 70% this cycle as markets hit a 'motherlode' of FOMO extremes, famed fund manager says
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