Saudi Arabia’s Aramco record the biggest deal in world’s IPO history

Saudi Arabia’s Aramco record the biggest deal in world's IPO history

Initial public offering (IPO) of Saudi Arabia’s Aramco snatched the biggest deal in history, raising $25.6 billion by selling shares in its state-owned oil giant, the company announced on Thursday, December 5th.

Saudi Aramco sold 3 billion shares at 32 riyals ($8.53) each in its IPO that means the deal raised more than China’s Alibaba (BABA) in its 2014 public debut.

“Following the announcement by Saudi Arabian Oil Company (Saudi Aramco) (the “Company”) on 17 November 2019 of the price range for the initial public offering of the Company (the “Offering”), the Company today announces the end of the Book-Building Period and the setting of the final offer price (the “Final Offer Price”) for the Offering at SAR 32.” The company said in a statement.

Confirmation of Offer Details

  • The Offering size (excluding any exercise of the Purchase Option) is 3,000,000,000 shares (collectively, the “Offer Shares”), comprising 1.5% of the Company’s share capital.
  • The offering process generated subscriptions by Institutional Subscribers of SAR397 billion / USD106 billion, which, together with the total demand from Individual Investors in the Offering, equals SAR446 billion / USD119 billion, or 465% of the total Offer Shares (assuming no exercise of the Purchase Option).
  • The Offering amount is SAR96.0 billion / USD25.6 billion (assuming no exercise of the Purchase Option).
  • The Offer Shares allocated to Individual Investors comprise 33.3% of the Offer Shares (which is equivalent to 0.5% of the Company’s outstanding share capital) while the Offer Shares allocated to Institutional Subscribers comprise 66.7% of the Offer Shares (which is equivalent to 1.0% of the Company’s outstanding share capital) (in each case, assuming no exercise of the Purchase Option).
  • For the purposes of allowing the Stabilising Manager to cover short positions resulting from any over-allotments, the Selling Shareholder has granted the Stabilising Manager a purchase option (the “Purchase Option”), pursuant to which the Stabilising Manager may purchase from the Selling Shareholder up to a maximum of 450,000,000 additional shares, representing 15% of the Offering size (the “Over-allotment Shares”) at the Final Offer Price.

The Purchase Option will be exercisable in whole or in part upon notice by the Stabilising Manager, at any time on or before 30 calendar days after the commencement of trading of the shares on the Saudi Stock Exchange (Tadawul) (the “Stabilising Period”).

  • In the event that the Purchase Option is exercised in full, the total Offering size will be 3,450,000,000 shares, representing an Offer amount of SAR110.4 billion / USD29.4 billion.

Key Offering Dates

Key Events Date
Deadline for payment of the subscription funds by Institutional Subscribers 11/4/1441H (corresponding to 8 December 2019G)
Refund of excess subscription monies (if any) to Individual Investors 15/4/1441H (corresponding to 12 December 2019G)
Expected trading commencement date for the Shares Trading of the Shares is expected to commence after all relevant legal requirements and procedures have been completed. An announcement of the commencement of trading of the Shares will be made on Tadawul’s website (www.tadawul.com.sa).