The biggest Initial Public Offering (IPO) in history has been executed by Saudi Aramco, securing a valuation of nearly $2 trillion. This accomplishment is a long-cherished goal for Saudi Crown Prince Mohammed bin Salman. Post-launch, the share price of Saudi Aramco soared to 35.2 Riyal ($9.39) each, up from the IPO price of 32 Riyal, marking a 10% increase which is the maximum allowed. In just an hour after going public, approximately 766.8 million shares were sold.
Saudi Aramco’s market value is now nearly six times larger than Exxon Mobil Corp and twice the size of Saudi Arabia’s national GDP. The company raised $25.6 billion in its IPO last week, setting another milestone. However, the success of Saudi Arabia’s oil giant extends beyond oil.
Crown Prince Mohammed bin Salman has prioritized opening up Saudi Aramco to foreign investments as a key economic objective for years. The primary aim of this endeavor is to generate funds for reinvestment in the economy, promoting diversification to reduce reliance on oil. While the IPO has attracted regional investors and raised substantial funds, the ultimate objective is for Saudi Aramco to secure an international listing.
This achievement represents a significant milestone for the Saudi economy. Saudi Energy Minister Prince Abdulaziz bin Salman expressed, “It’s a great day for Saudi Arabia and the leadership of Saudi Arabia and for the people of Saudi Arabia. It’s a D-Day for Aramco, it’s a day of reckoning and vindication,” in a statement to Reuters in Madrid.
