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Saudi Aramco releases listing details to begin November 17



Saudi Arabia's state-owned oil company said the offer period will begin on November 17 and end on December 4. It will price its shares on December 5, and trading on the Saudi stock exchange, Tadawul, is expected to start in mid-December, according to the prospectus.

The public offering may be the largest in history. Aramco has huge oil reserves and massive daily production. It has a monopoly in Saudi Arabia, the world's largest exporter of crude oil. The company posted a profit of $ 68 billion for the first nine months of this year, down 18% from the same period in 2018. The full-year profit was $ 1

11 billion.

The prospectus did not contain details of how much of the company will be relocated. The company will sell up to 0.5% of the shares to individual investors. There is a class of ordinary shares, and one share entitles you to one vote. Each shareholder has the right to attend and vote at the general meetings.

The company will not be able to list additional shares in six months after trading begins. All necessary regulatory and corporate approvals required for the offer are secured for the IPO, it states.

Details of the long-awaited stock exchange listing come as low oil prices, the climate crisis and geopolitical risk have created skepticism among international investors. [19659002] Crown Prince Mohammad bin Salman reportedly sought a valuation for Aramco near $ 2 trillion. But the model run by Palissy Advisors puts Aramco's value at just a billion dollars.

Aramco may have to rely heavily on wealthy local families, sympathetic sovereign wealth funds, or large clients like China who sign up for shares.

There is also a growing expectation that Aramco will need to sweeten the dividend to get more global investors in the door. The company has committed to an annual dividend of $ 75 billion through 2024. What investors earn on these payouts can compete with ExxonMobil ( XOM ) and Royal Dutch Shell [19659009] ( RDSA ) depending on Aramco's valuation. But Saudi Arabia may need to add more to increase interest in its partial privatization.

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