How To Buy Aramco Shares

Some U.S. financial advisers have expressed interest in buying shares in Saudi Aramco if they become more publicly available, in part because of its reputation as a highly efficient and profitable business, while other investors warn of the instability that comes with the geopolitical risks in the Middle East.

Aramco decided in November that it would not list its IPO shares on a major U.S. exchange, making it difficult for the average U.S. investor to gain access to the stock. Tadawul has strict rules about foreign investment. Qualified institutional foreign investors must have at least $5 billion in assets and at least five years of investing experience to be eligible to trade on the Saudi exchange. Prior to 2015, foreign investors were prohibited from trading on the Tadawul exchange entirely.

Not surprisingly, Aramco management is getting increasing pressure to follow the Big Oil playbook to raise dividend payments (it has little scope to buy back shares) in an effort to woo new investors.

He thinks the Saudi government could sell more Aramco shares on the Saudi exchange, while loosening restrictions on purchases by foreign investors, followed by a potential international listing, most likely in Asia.

The share capital of the firm (fully paid up) sixty billion Saudi Riyals (SAR), which is approximately US$16 billion. This capital translates to 200 billion ordinary shares, all owned by the Saudi government.

The prices will be based on market factors but are also influenced by pre-IPO factors such as the structure of the company, number of shares sold or listed, share prices of similar companies, growth potential and demand from potential investors.

Each individual investor is required to subscribe for his or her preferred number of shares in multiples of ten, for example, 10, 20, 30 etc. using a \"Retail Subscription Form\" available at specified entities.

If there is a such a difference, the investor can choose to get the difference in cash by crediting the investor's account or to get additional offer shares worth the difference, at the discretion of the company and the joint bookrunners and advisors.

In this case, if the eligible investor holds his subsribed shares for a minimum period of 180 days, he or she will be eligible to receive one bonus share for every ten offer shares purchased at the beginning - to a maximum of 100 bonus shares.

On 18 December 2019, the company's shares commenced trading on the Tadawul stock exchange. The shares rose to 35.2 Saudi riyals, giving it a market capitalisation of about US$1.88 trillion,[14] and surpassed the US$2 trillion mark on the second day of trading.[15] In the 2022 Forbes Global 2000, Saudi Aramco was ranked as the 3rd-largest public company in the world.[1]

In January 2016, the Deputy Crown Prince of Saudi Arabia, Mohammad bin Salman Al Saud, announced he was considering listing shares of the state-owned company, and selling around 5% of them in order to build a large sovereign wealth fund.[32]

On 9 November 2019, Saudi Aramco released a 600-page prospectus giving details of the IPO. According to the specifications provided, up to 0.5% of the shares were locked for individual retail investors.[63]

On 4 December 2019, Saudi Aramco priced its offering at 32 Saudi riyals (approximately US$8.53 at the time) per share. The company generated subscriptions of total amount equals US$119 billion representing 456% of total offer shares. It raised US$25.6 billion in its IPO, making it the world's largest IPO, succeeding that of the Alibaba Group in 2014.[64] The company commenced trading on Tadawul on 11 December 2019, with shares rising 10% to 35.2 riyals, giving the company a market capitalisation of about U$1.88 trillion, and making Saudi Aramco the world's largest listed company.[65][66]

SABIC announced that Saudi Aramco signed today a share purchase agreement to acquire a 70% majority stake in SABIC from the Public Investment Fund of Saudi Arabia in a private transaction. The agreed purchase price for the shares is SAR 123.40 per share, totaling SAR 259.125 billion, which is equivalent to USD$ 69.1 billion.

The remaining 30% publicly traded shares in SABIC are not part of the transaction, and Saudi Aramco has advised that it has no plans to acquire these remaining shares. The transaction is subject to certain closing conditions, including regulatory approvals.

On Tuesday, May 12, the last of the oil majors will release its financials. Saudi Aramco, which sold shares publicly on the local Tadawul exchange in December, is releasing its financials six weeks after the quarter ended, but it decided against holding an earnings call to answer questions from investors. Aramco is a very different firm from its competitors and those differences will be evident in the financial report.

Established in 1971 to channel oil wealth into economic development, the PIF has historically been a holding company for government shares in partially privatized state-owned enterprises (SOEs), including SABIC, the National Commercial Bank, Saudi Telecom Company, Saudi Electricity Company, and others. Crown Prince Mohammed bin Salman is the chairman of the PIF and announced his intention in April 2016 to build the PIF into a $2 trillion global investment fund, relying in part on proceeds from the initial public offering of up to five percent of Saudi Aramco shares.

At the end of 2019, the PIF reported its investment portfolio was valued at $300-$330 billion, mainly in shares of state-controlled domestic companies. In an effort to rebalance its investment portfolio, the PIF has divided its assets into six investment pools comprising local and global investments in various sectors and asset classes: Saudi holdings; Saudi sector development; Saudi real estate and infrastructure development; Saudi giga-projects; international strategic investments; and an international diversified pool of investments.

Saudi Aramco shares fell to more than 10pc below their post-float highs on Sunday as the fallout from the assassination of Iranian commander Qassim Suleimani by the United States sent Middle Eastern shares plummeting.

Today Aramco is the wealth of the nation, tomorrow, might it belong only to those who can afford to buy shares The main problem deciding how much Aramco is worth. If its value is low, why privatise it And if the price of oil suddenly went up, why would it need to be sold

Shares of Aramco jumped 1.85% on Sunday on the earnings report, with a share costing 41.40 Saudi riyals, or $11.04 on the Tadawul stock market. Aramco shares have shot up since the start of the year, making it the world's most valuable company last week with a market cap of around $2.43 trillion.

Saudi Arabia says it's going ahead with plans to sell shares of the state oil company, Aramco. It's a long-delayed effort to raise money for the monarchy's reform program but investors are skeptical. Rachel Ziemba joins Jackie Northam on NPR's All Things Considered to discuss. 59ce067264

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