Saudi Arabias Public Investment Fund (PIF) will invest up to SR500bn ($133bn) across a number of sectors following the public listing of oil giant Saudi Aramco, according to the kingdoms Deputy Crown Prince Mohammed bin Salman bin Abdulaziz al-Saud.
After the listing, [PIF] will invest up to SR500bn in the Saudi economy. It will be in a position to help develop the kingdom after the necessary funds are raised from the listing of Aramco, said Prince Mohammed during a televised interview in Arabic on 2 May.
Prince Mohammed said the PIF will invest 50-100 per cent of its cash inside the kingdom, with military production and manufacturing being a primary focus. He also highlighted the logistics sector serving the Red Sea as key area that is currently lacking investment and said that the kingdom will look at ways to develop companies serving the west coast of the country.
The kingdom intends to the part-privatise some of the state-controlled assets as part of its broader diversification strategy, but the share offering of Aramco been the main focus of attention at home and abroad.
The firm, which has been the main revenue-earner for Saudi Arabia over the past eight decades, is targeting the second half of the 2018 for the public listing. Riyadh aims to list less than 5 per cent of Aramco, which some estimate to be valued at more than $2 trillion. Most of the estimated proceeds of the public float will be transferred to the kingdoms sovereign wealth fund Public Investment Fund (PIF), which Prince Mohammed has said will be used to reinvest in the key sectors.
The primary listing will take place on Saudi Stock Exchange (Tadawul) and one or two as yet unnamed international bourses. It may favour a western exchange including New York, London or Toronto, and is considered unlikely to pursue listing plans for an Asian exchange despite holding talks with bourses there.
If [the] Aramco [listing] doesnt happen it could take Saudi Arabia 40 years to start our diversification efforts, said Prince Mohammed who also said in his interview that up to 100 state-owned companies will be privatised in the coming period.
He also confirmed that the Aramco listing will be about 5 per cent of the firm and will happen in 2018.