Aramco closed its follow-on offering, raising USD 11.2 bn in what was the “largest secondary offering in EMEA since 2000,” the government and the state-owned oil giant said in a statement (pdf). The offering was also the largest in equity capital markets in the region since Aramco’s own blockbuster IPO in 2019. Newly sold shares began trading on Tadawul on Sunday, after the final allocation of shares took place on Friday, 7 June.

What they said: “This landmark transaction achieves the goals of diversifying and broadening Aramco’s shareholder base with strong participation from new international and local investors, further supporting the liquidity of our shares,” Aramco’s CEO Amin Nasser said.

REFRESHER- The oil giant set the final price for its secondary share sale below expectations at SAR 27.25 per share, pricing its stock in the lower half of its proposed range of SAR 26.7 to SAR 29.0 a share. Foreign investors were big buyers in the offering, with the majority of the institutional tranche — which accounts for 90% of the shares on offer — allocated to “investors located outside of the Kingdom,” according to Aramco. The follow-on offering saw foreign institutional ownership in the oil giant clock in at a 0.73% stake.

Aramco could still raise more if stabilizing manager Merrill Lynch KSA exercises a greenshoe option. The investment bank can purchase up to 10% of shares being offered at the set final price “to cover short positions resulting from any overallotments.” If the greenshoe is exercised, Aramco could raise the stake on offer to 0.7% — up from 0.64% — to raise roughly USD 12.4 bn. The stabilization period runs until Tuesday, 9 July.

Background: The transaction comes as the government looks to unlock non-oil sources of income to plug its budget deficit and push USD bns worth of gigaprojects out of the pipeline. Think massive investments in sports, AI, tourism, and infrastructure. Proceeds from the sale will likely go into the Public Investment Fund’s coffers, analysts previously told Reuters.

ADVISORS- SNB Capital is lead manager. HSBC, BofA, Citi, Goldman Sachs, JP Morgan, Morgan Stanley, Merrill Lynch, and SNB Capital are joint global coordinators, bookrunners and financial advisors. Our friends at EFG Hermes KSA are domestic bookrunners alongside Al Rajhi Capital, Riyad Capital, and Saudi Fransi Capital. Meanwhile, M. Klein and Company and Moelis are independent financial advisors. Merrill Lynch is the stabilization manager. White & Case is legal counsel to Aramco, while PwC is auditor. Receiving agents include Alinma Bank, Al Rajhi Banking and Investment Corporation, Arab National Bank, Banque Saudi Fransi, Riyad Bank, Saudi Awwal Bank, Saudi National Bank.

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