Page 7 - MEOG Week 05 2021

MEOG FINANCE & INVESTMENT MEOG

MbS talks of plans to

list more Aramco shares

SAUDI ARABIA AT last week’s Future Investment Initiative con- assets under management (AUM) and accord-
ference in Saudi Arabia, the Kingdom’s Crown ing to Rumayyan, this is expected to increase to
Prince Mohammed bin Salman (MbS) said that SAR4 trillion ($1.07 trillion) by 2025 and SAR7.5
more shares in Saudi Aramco would be sold in trillion ($2 trillion) by the end of the decade.
order to expand the country’s Public Investment Prior to the 2019 IPO, it had planned a listing
Fund (PIF). of up to 5% on either the London, Tokyo or New
“There will be Aramco share offerings com- York stock exchanges, but with concerns about a
ing in the coming years, and this cash will be lack of investor appetite as well as potential legal
transferred to the Public Investment Fund,” he issues relating to the involvement of Saudis in
said, noting that the PIF would use the proceeds the 9/11 attacks in the US these ambitions were
to invest both locally and internationally. pegged back.
The comments echoed statements from PIF Meanwhile, speaking at the ‘Davos of the
governor and Aramco chairman Yasir Al-Ru- Desert’, MbS noted that the mega-projects
mayyan earlier in the week. backed by the PIF, which include the $500bn
In late 2019, the Saudi government sold a futuristic business park and city NEOM and a
stake of 1.5% in Aramco in the company’s ini- Red Sea tourism hub have a zero book value in
tial public offering (IPO) on the Tadawul All PIF’s accounts and are expected to generate rev-
Share Index (TASI), the Saudi stock exchange. enues, thereby expanding the fund.
This raised $25.6bn, making it the world’s largest The PIF has plans in place that will see it
every IPO, with a further 0.2% or so sold later spend SAR3 trillion ($800bn) into new sectors
that increased the return to $29.4bn. This was over the coming decade while creating 1.8mn
duly transferred to the PIF, which is the country’s direct and indirect jobs by 2025.
main sovereign wealth fund. Saudi Aramco is currently valued at around
The fund currently has around $400bn of $1.86 trillion.™

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