In a statement on Sunday, Saudi Aramco said it aims to sell about 1.5% of its 200 billion shares in partial privatization for between 30 riyals ($ 8) and 32 riyals ($ 8.53) each.
This means that Aramco, the world's most profitable company, can be worth between $ 6 trillion ($ 1.6 trillion) and $ 6.4 trillion ($ 1.7 trillion) – which also makes it the world's clearest valuable company ahead of Apple ( AAPL ) .
It won't be the only record to fall if Aramco achieves the higher price: at that level, stock sales would increase just over $ 25 billion, making it slightly larger than Alibaba's ( BABA )
4 debut on the New York Stock Exchange, so far the world's largest stock exchange listing.
Saudi Arabia sells shares in Aramco for the first time as part of an economic diversification plan aimed at winding down the kingdom of oil.
Aramco has huge oil reserves and massive daily production. It has a monopoly in Saudi Arabia, the world's largest exporter of crude oil. It made $ 111 billion in profits in 2018, and has promised to pay an annual dividend of $ 75 billion through 2024.
Crown Prince Mohammed bin Salman reportedly sought a valuation for Aramco near $ 2 trillion. But low oil prices, the climate crisis and geopolitical risk have created skepticism among international investors. Up to 0.5% of the company will be sold to individuals and the rest will be offered to institutional investors.
Aramco may have to rely heavily on wealthy local families, sympathetic sovereign wealth funds, or large customers like China who sign up for shares. Reuters reported on Sunday that Aramco will not market the IPO abroad.
The price for the shares will be set on December 5, and trading on the Saudi stock exchange is expected to start later that month, according to Aramco's prospectus.
Wall Street's biggest name is giving Saudi Arabia advice on privatization, despite pressure from activists saying that funding for fossil fuel companies will exacerbate the climate crisis. They have also urged banks not to do business with the Kingdom because of the human rights protocol, including the brutal killing of Washington Post columnist Jamal Khashoggi.
Aramco noted Bank of America ( BAC ) Goldman Sachs ( GS ) JPMorgan ([19459008)] JPM ) Citigroup ( C ) Credit Suisse ( CS ) Morgan Stanley (] MS ) and HSBC ( HBCYF ) as joint financial advisors for the transaction. They have all previously declined to comment on CNN Business.
– John Defterios and Julia Horowitz contributed to this article.