Saudi Aramco IPO to be delayed?

The mammoth listing of state-owned oil/chemicals firm Saudi Aramco is unlikely to go ahead this year, according to the UK’s Financial Times, with talks floating of the world's biggest flotation exercise expected to be delayed to next year. The Riyadh-headquartered firm had planned to begin trading on the country's domestic stock market (Tadawul) and one or more foreign exchanges in the second half of 2018.

The FT report also suggested that Saudi Aramco advisors were struggling to arrive at the US$2 trillion valuation sought by Saudi's crown prince Mohammed bin Salman.

Meanwhile, Saudi Arabia's Energy Minister Khalid al-Falih also said in a Bloomberg interview that while Aramco's offering could conceivably take place in 2019, the timeline would not be especially relevant.

If the flotation is delayed, it would represent a setback for the world's largest oil producer and dampen its efforts to reform the Saudi economy as the IPO is seen as key to this strategy.

Saudi Aramco, currently a private company owned by the kingdom's government, is aiming to list 5% of the company that could raise about US$100 billion and attract a valuation in the range of US$1 trillion to US$2 trillion.

London, New York and Hong Kong are among the foreign bourses competing for the share sale.

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