The retail subscription for Saudi Aramco's initial public offering (IPO) has reached $8.69 billion (32.6 billion riyals) as of Wednesday evening, according to the lead manager of the IPO Samba Capital and Investment Management Company.
The retail element of the sale so far totals 1,017,816,380 shares, meaning the retail portion of Saudi Aramco’s IPO has been fully covered at 102%.
Rania Nashar, deputy chairman of Samba Capital, said the 'demand level witnessed during the IPO is a strong indicator of the trust that the investing community has in the strength of the company’s financial position.'
She also remarked that financial awareness among Saudi citizens has risen in their efforts to boost their savings by investing in companies offering attractive returns.
The world's largest crude oil exporter is highly dependent on oil exports for its economy, and oil sales constitute the lion's share of the government's revenues.
To diversify its economy and as part of its Vision 2030 plan, the kingdom is preparing to sell 1.5% of Saudi Aramco, considered the kingdom's crown jewel, at an indicative price range of $8-$8.53 (30-32 riyals) on its domestic stock exchange Tadawul.
The higher end of the share price would raise as much as $25.6 billion from the IPO, putting the market value of the oil giant between $1.6-$1.7 trillion below the government’s anticipated target value of $2 trillion.
Saudi Aramco received regulatory approval from the kingdom's Capital Market Authority on Nov. 3 to float on the Saudi stock exchange Tadawul.
The subscription for retail investors began on Nov. 17 and will run until Nov. 28, while the offering period for institutional investors started on Nov. 17 and will close by the end of Dec. 4, according to Saudi Aramco's prospectus released on Nov. 10.
Aramco is expected to announce the final price for the share offering on Dec. 5.
By Busranur Begcecanli