Saudi Arabia Nets $12.35 Billion From Aramco Share Offering

The final proceeds for Saudi Arabia from the secondary sale of shares in its oil giant Aramco came in at $12.35 billion after the exercising of an over-allotment option, boosting the Kingdom’s total gain from the sale by $1 billion.

Saudi Aramco sold last month a 0.64% stake in a secondary offering. Aramco priced 1.545 billion shares on offer in its latest share sale at $7.27 (27.25 Saudi riyals) apiece, based on the results of the book-building process. That was a discount of 6% compared to the closing price of Aramco’s shares on the Saudi stock exchange, Tadawul, on the day before the secondary offering was announced at the end of May.

This sale raised $11.2 billion for the Kingdom of Saudi Arabia.

But after the so-called stabilization period ended, and the over-allotment option was exercised, the Saudis are netting an additional $1 billion and total proceeds came in at $12.35 billion, according to a statement carried by Bloomberg.  

Saudi Aramco made its debut on the Saudi Stock Exchange in December 2019 and raised around $30 billion in a share listing which became the world’s largest ever.

Since the IPO, the Saudi rulers, including Crown Prince Mohammed bin Salman, have said on several occasions there would be more Aramco shale sales in the future.

Additionally, Saudi Aramco now plans to raise at least $3 billion from a new bond issue that would be its first in three years, sources with knowledge of the matter told Bloomberg earlier this week.  

Saudi Aramco plans to offer bonds with 10, 30, and 40 years of maturity and is expected to begin meetings with fixed-income investors on Tuesday, according to Bloomberg’s sources. 

The proceeds from Aramco’s new bond sale are expected to go to refinancing existing borrowings and helping the investment program of the world’s largest oil company by market value and production.

By Tsvetana Paraskova for Oilprice.com

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