{"id":92551,"date":"2024-05-30T00:00:00","date_gmt":"2024-05-30T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/is-aramco-pulling-the-trigger-on-its-secondary-offering-today\/"},"modified":"2024-05-30T00:00:00","modified_gmt":"2024-05-30T00:00:00","slug":"is-aramco-pulling-the-trigger-on-its-secondary-offering-today","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2024\/05\/30\/is-aramco-pulling-the-trigger-on-its-secondary-offering-today\/","title":{"rendered":"Is Aramco pulling the trigger on its secondary offering today?"},"content":{"rendered":"

Aramco looks ready to pull the trigger any moment now on <\/strong>blockbuster secondary sale. <\/strong>The Wall Street Journal<\/a> expects the oil giant to go ahead with a USD 10-20 bn sale \u201cas soon as this week\u201d while Bloomberg<\/a> claims that it will be a USD 10 bn sale and that the formal launch of the transaction will come on Sunday.<\/p>\n

The prospect of a sale has already attracted \u201cinformal interest\u201d from investors<\/strong>, Bloomberg notes. Aramco will boost its dividend this year by as much as 30%<\/a> over 2023 thanks to a performance-based payout despite a 14% year-on-year drop in net income in 1Q 2024, making the company an attractive dividend play. <\/p>\n

The oil giant\u2019s shares + Tadawul are down ahead of the offering:<\/strong> A strong pipeline of IPOs and expectations that the Aramco sale will absorb market liquidity has seen Tadawul investors holding onto cash<\/a> for fresh paper. Less liquidity in the market coupled with expectations that Opec+ will extend voluntary oil cuts when it meets next week pushed Aramco\u2019s shares to their lowest level in over a year, Bloomberg<\/a> reported. Aramco shares are down just about 12% YTD, closing at SAR 29.05 yesterday, which is below its 2019 offering price of SAR 32.00. <\/p>\n

What the pundits are saying: <\/strong>\u201cSaudi Aramco\u2019s share price has been under pressure from an oil production level that is limited around 9 mn barrels a day due to the ongoing OPEC+ cuts,\u201d said Salih Yilmaz, senior industry analyst at Bloomberg Intelligence. \u201cIt continues to demand a higher price-to-earnings valuation versus international oil major peers.\u201d <\/p>\n

BACKGROUND-<\/strong> Reuters reported last week<\/a> that Aramco could proceed with the sale in June, with the newswire seeing the oil giant put on a full roadshow to market the offering rather than doing an accelerated book build. The PIF increased its stake<\/a> in Aramco to 16% in March as news of the potential sale surfaced. If the offering goes ahead, it would be one of the world\u2019s largest offerings<\/a> in recent years. Aramco raised USD 29.4 bn on Tadawul in 2019 in what remains the biggest IPO in history.<\/p>\n

ALSO WORTH NOTING FROM PLANET FINANCE-<\/p>\n