Written by Maha Al-Dahan
DUBAI (Reuters) – Saudi Arabia has floated more than half of the $11.2 billion Aramco share sale (Tadawul) with foreign investors, two sources familiar with the matter told Reuters on Saturday.
Saudi Arabia is seeking to attract international investment by pumping tens of billions of dollars into projects to diversify its resources away from dependence on oil. However, foreign investments have repeatedly missed their targets.
“There have been multiple requests from the US, UK, Hong Kong and Japan,” one source said.
Sources had previously told Reuters that global demand for selling secondary shares was greater than demand for Aramco’s initial public offering in 2019.
Aramco said on Friday that its shares were priced at 27.25 riyals ($7.27) after the company set a price range between 26.70 and 29.00 riyals.
The secondary offering, which the banks involved called the “bond project,” took months of planning.
One of the sources said that as a result of the deal, more than 120 new international investors will be added to Aramco.
He said, “The total demand for the offering was greater than $65 billion across major global institutions and local retail offers.”
Saudi Arabia's de facto ruler, Crown Prince Mohammed bin Salman, Vision 2030 funds endeavors as diverse as electric cars to build futuristic cities in the desert, mainly through the Public Investment Fund (PIF).
The $925 billion sovereign fund, after reducing some of its major projects, aims to increase its focus to push this vision forward.
Proceeds from the share sale are likely to be transferred to the Public Investment Fund, although the money could also help plug the kingdom's budget deficit that has risen with the decline in oil prices, sources and analysts said.