Report confirms delay to Saudi Aramco listing after attacks

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News ID: 43762
Asia » Asia
Publish Date: 18:34 - 24 September 2019
TEHRAN, Sept 24- A report shows Saudi authorities have effectively delayed plans for floating state-run Aramco oil company on the stock market after attacks on oil installations east of the kingdom earlier this month.

Report confirms delay to Saudi Aramco listing after attacksTEHRAN, Young Journalists Club(YJC)_The Reuters news agency cited sources with direct knowledge of Aramco’s future plans as saying on Tuesday that initial public offering (IPO) of the company would not take place this year despite pledges given by senior Saudi energy officials that the listing would take place by early November.

“They need to build confidence – in addition to restoring production,” said one of the sources, making a reference to September 14 attacks by Yemen’s ruling Ansarullah movement on Aramco’s Khurais and Abqaiq plants, which process and clean crude.

Aramco officials had said last year that the company would offer one percent of its shares for sale on the domestic stock market as early as November 2019.

The IPO had been expected as a first step for the company to sell five percent of stakes and raise at least $100 billion to help the Saudi government fund an ambitious plan for modernizing its economy and diversifying it away from oil.

However, attacks on oil installations have been seen as a major blow to Crown Prince Mohammad bin Salman and his Vision 2030 plan.

Reports suggest the young prince has been struggling to find new buyers for shares of Aramco, the world’s largest oil company which he has valued at $2 trillion.

Experts said the attacks on Aramco oil installations have clearly discouraged investors from buying shares at the company as the drone strikes by the Yemenis have exposed serious vulnerabilities in Saudi Arabia’s ability to protect its assets.

“I think that the attacks on the Aramco facilities have surprised portfolio managers in that they show Saudi assets as being more vulnerable to attack and disruption than many had assumed,” said Ross Teverson from the London-based Jupiter Asset Management.

The Reuters said Aramco authorities had held emergency meetings with bankers and analysts after the attacks to find a way forward on the company’s IPO.

It said investors have been clearly opposed to Saudi-proposed timeline for listing on the domestic bourse.

Source :presstv

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