Saudi Arabia denies Aramco IPO has been called off

23 August 2018
Energy Ministry has released a statement in response to media reports that part-stock listing of world’s largest oil company had been shelved

Saudi Arabia’s Energy Minister Khalid al-Falih has denied that the planned part initial public offering (IPO) of state oil company Saudi Aramco has been called off.

“The government remains committed to the initial public offering of Saudi Aramco, in accordance with the appropriate circumstance and appropriate time chosen by the government,” Al-Falih said in a statement released in the early hours of 23 August.

The statement came in response to an article published by news agency Reuters on 22 August, which said Riyadh had called off both the domestic and international stock listing of the state oil company and that financial advisers working on the proposed listing had been “disbanded”.

The Ministry of Energy statement said that in preparation for the Aramco listing the government had undertaken a number of measures including: "... issuing a new income tax law as it relates to hydrocarbons activities; reissuing a long-term exclusive concession; and appointing a new Board of Directors, amongst other measures to safeguard its interests and those of the company's future private shareholders."

The statement also stated Aramco had taken a number of actions to prepare for the IPO. These include: amending byelaws, converting to a joint stock company and undertaking the "first independent clarification of its hydrocarbon reserves."

"This is all positive progress on what is a complex process, preparing the company and the Kingdom for what will ultimately be a global landmark market offering of unprecedented quality and scale,” concluded Al-Falih in the statement.

Fresh doubts over the planned part-listing of Aramco have arisen in recent weeks after it was revealed Aramco was considering acquiring a majority stake in Saudi Basic Industries Corporation (Sabic) in a deal worth up to $70bn. Concerns over the impact of such an acquisition on the planned Aramco IPO intensified when Aramco CEO Amin Nasser said that, if the Sabic deal was completed, it would affect the timeline for the partial IPO, which has already been pushed back by a year.

The planned Aramco IPO forms part of Crown Prince Mohammed bin Salman’s Vision 2030 economic programme, which was launched in 2016 to overhaul the kingdom’s economy and reduce its dependence on oil export revenues.

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