The initial public offering of the gigantic oil company Saudi Aramco would have been the largest in history.
Reuters is reporting that Saudi Arabia is calling off their plan to list shares of Saudi Aramco, in what would have been the largest initial public offering of all time.
As noted by CNBC, “The initial public offering was poised to be the largest ever and was at the centre of Crown Prince Mohammed bin Salman’s ambitious plan to overhaul the Saudi economy. The Saudis had hoped to attract a $2 trillion valuation for Aramco, the world’s largest oil company, though some outside analysts have pegged its value at half that level.”
Stock markets around the world had competed to host the IPO, with New York & London being seen as among the favourites. The Toronto Stock Exchange had also thrown their hat into the ring, though most saw it as a long-shot bid at best.
Now, there will be questions about the broader impact this will have on Saudi Arabia’s economic diversification plan. With their economy highly reliant on oil, Saudi Arabia has been seeking to develop other industries, and profits from the IPO would have been part of facilitating that. Even before the reported IPO cancellation, the reform plan has faced growing doubts as Saudi Arabia’s war in Yemen, crackdown on dissidents, and confrontations with other nations escalate.