Aramco could pull the trigger on a secondary share sale in the coming weeks

Aramco could pull the trigger on secondary sale of shares as soon as next month in a transaction that could raise c. USD 10 bn, Reuters reports citing two unnamed sources it says are familiar with the matter. Aramco has not confirmed the share sale, which some originally said could be worth as much as USD 20 bn. The newswire expects Aramco to put on a full roadshow to market the offering rather than doing an accelerated book build.

PIF has increased its stake in Aramco ahead of the expected sale: Sovereign wealth fund PIF doubled its stake in Aramco to 16% in March, which Aramco says did not affect its total number of issued shares nor its operations, strategy or dividend distribution policy, maintaining that the Saudi government holds its largest stake at 82.19% in direct shareholding.

Aramco’s net income fell 14.4% y-o-y to SAR 102.3 bn (USD 27.3 bn) in 1Q 2024, and its revenues dipped 3.7% y-o-y to SAR 402.0 bn (USD 107.2 bn), which it attributed to lower crude oil sales and falling refining and chemicals margins. The oil giant will nevertheless boost its dividend this year by as much as 30% over 2023 thanks to a performance-based payout.

MEANWHILE- The oil giant is reportedly eyeing Shell’s downstream assets in South Africa, Bloomberg reports, citing unnamed sources it says are familiar with the matter. The potential sale could have a price tag of USD 800 mn and would be the latest move in Shell’s divestment South Africa after it offloaded the country’s biggest oil refinery in 2022. Talks are ongoing with “several highly credible parties,” Bloomberg quotes Shell’s spokesperson as saying.

What’s on the table: The sale would include the company’s aviation, marine, construction and road, trading and supply, commercial fuels, and lubricant operations, Bloomberg reports citing the company’s announcement earlier this month. Shell owns a network of 600 stations across the country.

Other potential bidders reportedly include Abu Dhabi National Oil (Adnoc), South Africa’s chemicals and energy player Sasol, Swiss-based Puma Energy, and Glencore.