Saudi Arabia has denied reports it has cancelled plans to publicly list state-owned oil giant Aramco.
This was strenuously denied yesterday by Saudi energy minister Khalid al-Falih, who said: “The government remains committed to the initial public offering of Saudi Aramco, in accordance with the appropriate circumstances and appropriate time chosen by the government.”
The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
A report in the Financial Times seems to contradict these claims, however, as the newspaper said the Gulf kingdom’s sovereign fund is set to borrow up to $12 billion from international banks after the IPO was put on hold.
A separate source also told Axios: the IPO “has been officially dead for a month or so — everyone got sent home for Ramadan and of course Eid just broke, but no one was invited back.”
The proposed listing of Aramco was a central part of Crown Prince Mohammed bin Salman’s reform drive aimed at restructuring the kingdom’s economy, reducing its dependence on oil revenue and cutting its debt.
In 2016 the prince announced plans to sell about 5% of the company via a local and international listing predicting the sale would value the whole company at $2 trillion or more.
However, the decision to take the company public has been met with fierce opposition in the upper echelons of Saudi Arabia’s ruling family, while several industry experts questioned whether a valuation that high was realistic warning it could instead expose the weaknesses within the Saudi economy.
This has not stopped exchanges in London, Hong Kong and New York vying to host the IPO.
In London the Financial Conduct Authority changed its rules to make the listing easier, “attracting criticism from MPs and from the Institute of Directors who said adapting regulations to accommodate Saudi Aramco could harm the UK's reputation for good governance”, says the BBC.
The Daily Telegraph says the decision to suspend the IPO “raises questions” for City authorities who relaxed Britain’s listing rules in an attempt to attract Aramco to the London market in competition with New York and Hong Kong.
-
‘The West needs people’Instant Opinion Opinion, comment and editorials of the day
-
Filing statuses: What they are and how to choose one for your taxesThe Explainer Your status will determine how much you pay, plus the tax credits and deductions you can claim
-
Nan Goldin: The Ballad of Sexual Dependency – an ‘engrossing’ exhibitionThe Week Recommends All 126 images from the American photographer’s ‘influential’ photobook have come to the UK for the first time
-
Epstein files topple law CEO, roil UK governmentSpeed Read Peter Mandelson, Britain’s former ambassador to the US, is caught up in the scandal
-
Iran and US prepare to meet after skirmishesSpeed Read The incident comes amid heightened tensions in the Middle East
-
Israel retrieves final hostage’s body from GazaSpeed Read The 24-year-old police officer was killed during the initial Hamas attack
-
China’s Xi targets top general in growing purgeSpeed Read Zhang Youxia is being investigated over ‘grave violations’ of the law
-
Panama and Canada are negotiating over a crucial copper mineIn the Spotlight Panama is set to make a final decision on the mine this summer
-
Why Greenland’s natural resources are nearly impossible to mineThe Explainer The country’s natural landscape makes the task extremely difficult
-
Iran cuts internet as protests escalateSpeed Reada Government buildings across the country have been set on fire
-
US nabs ‘shadow’ tanker claimed by RussiaSpeed Read The ship was one of two vessels seized by the US military
