10 Jun 2024
RIYADH: Saudi Aramco’s shares rose by 1.06 percent on June 9, closing at SR28.60 ($7.63) after opening at SR27.95, marking the first trading day following a secondary share offering expected to raise around $11.2 billion.
The final price for the secondary share sale was set at SR27.25, toward the lower end of the specified price range.
This comes as the company’s allocation to international investors reached 0.73 percent of total shares following the completion of the new issue.
“The majority of the shares constituting the institutional tranche of the offering was allocated to investors located outside of the Kingdom,” the company said in a statement.
In addition to the international allocation, the oil giant has allocated 0.89 percent of its total shares to domestic institutional investors and 0.76 percent to retail investors.
Aramco’s latest share offering saw close to 60 percent allocated to international investors, sources told Arab News.
In a press release, Aramco said that institutional investors, both international and domestic, include entities that have acquired shares through the initial public offering, or open market purchases since then.
Retail investors consist of individual investors, including high-net-worth individuals, who have similarly purchased shares through the IPO, or open market transactions.
The statement further disclosed that approximately 97.62 percent of the issued shares are held by other shareholders, including the Saudi government.
Other shareholdings encompass shares owned by the government, shares acquired by or transferred to government-owned entities, subsidiaries, and affiliates from the government.
This category also includes executives, directors, and any other individuals typically considered insiders, along with 163 million shares held in treasury.
Aramco said the move aligns with its strategic vision to become the world’s leading integrated energy and chemicals company.
It aims to strengthen its global position by maintaining its oil production, expanding its gas production capacity, and integrating its upstream and downstream operations to secure demand for its crude oil.
The company said it is enhancing the resilience and strategic integration of its refining and chemicals portfolios to capture more value across the hydrocarbon value chain and improve the balance of its fuels and chemicals production.
Furthermore, Merrill Lynch Co. Saudi Arabia, an investment management company, has announced pre-stabilization activities in relation to the secondary offering of shares in Aramco.
As per a statement from Tadawul, the firm, acting as the stabilizing manager, has indicated its intention to stabilize the offer of the following securities in accordance with the instructions on the price stabilization mechanism in IPOs.
Earlier in June, Aramco initiated the sale of shares worth over $10 billion in what constitutes its second public offering.
This marks the company’s second listing following its IPO in December 2019, which raised a record-breaking $25.6 billion.