Saudi Arabia replaces Saudi Aramco chairman ahead of potential Initial Public Offer (IPO)

Saudi Aramco also termed as Saudi Arabian Oil Company is possible to give roles to Citigroup Inc., Goldman Sachs Group, Inc., HSBC Holdings plc, and Samba Financial Group for its initial public offering (IPO). The four banks would likely get these roles in addition to US-based Morgan Stanley and JPMorgan Chase & Co. who plays an essential role in the transaction before the process halted last year. Recently, Saudi energy minister Mr. Khalid Al-Falih announced that Aramco might go public in 2020 or 2021. Aramco determined to move up its IPO owing to the success of its debt offering. Oil prices will rise as the market started to price in the current geopolitical risk of a weekend drone attack on a Saudi Arabia oil facility.

Aramco is planning to sell around 5% stake by the end of 2021. It could be one of the biggest IPO. It is projected to appoint the advisers on its share sale shortly. The IPO is a centerpiece of Saudi Arabia’s economic changes drive to bring foreign investment (FI) and expand oil business. Selling some percent stake, which can be one of the largest IPO, is a major part of Prince Mohammed’s program to wean the Saudi economy off a reliance on oil. IPO plan was put on hold earlier as Aramco focus on the US$ 69 Bn possession of a significant stake in a state chemical maker. The country’s de facto ruler has told that Aramco to be valued at more than US$ 2 trillion, but analysts see as US$ 1.5 trillion.

The oil producers told that Saudi investment banks that it will invite pitches at the end of September 2019 from local underwriters seeking a role in the company’s domestic listing. Several options are being considered, and no final decisions have been made on the structure of the deal. Saudi Arabia called the head of its sovereign wealth fund as chairman of oil giant Aramco. It replaced Energy Minister Mr. Khalid A. Al-Falih as the state-owned company plans for a much-anticipated IPO. Mr. Khalid announced that Mr. Yasir al-Rumayyan’s appointment on Twitter as an essential step to prepare the company for a public offering. Mr. Mohammed bin Salman announced plans for a partial IPO in 2016. The world’s most profitable company plans to list in Saudi Arabia and on an international exchange. Mr. Al-Rumayyan, MD of the Saudi Public Investment Fund, served on Aramco’s board before becoming its chairman.

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