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Saudi Aramco declares $1.71 tn valuation in blockbuster IPO

News Network
November 17, 2019

Riyadh, Nov 17: Saudi Arabia on Sunday put a value of up to $1.71 trillion on energy giant Aramco in what could be the world's biggest IPO, but missed Crown Prince Mohammed bin Salman's initial target of $2 trillion.

Aramco said it would sell 1.5 percent of the company in a blockbuster initial public offering worth at least $24 billion.

"The base offer size will be 1.5 percent of the company's outstanding shares," the state-owned energy giant said in a statement that set the price range at 30-32 Saudi riyals per share ($8-8.5).

The much-delayed offering is scaled down from original plans, but it still rivals the world's biggest listing so far -- the $25 billion float of Chinese retail giant Alibaba in 2014.

Aramco had initially been expected to sell a total of five percent on two exchanges, with the first listing of two percent on the kingdom's Tadawul bourse, followed by a further three percent on an overseas exchange.

But the firm has said there are no current plans for an international stock sale, indicating that the long-discussed goal had been shelved for the time being.

Saudi Arabia is pulling out all the stops to ensure the success of the IPO, a cornerstone of de facto ruler Prince Mohammed's ambitious plan to diversify the economy by pumping funds into megaprojects and non-energy industries.

S&P Global Ratings said the stock market debut could enable the kingdom to strengthen its financial position.

"If subsequently effectively deployed, the funds raised could be used to support longer-term economic growth in Saudi Arabia," it said.

The government has reportedly pressed wealthy Saudi business families and institutions to invest, and many nationalists have labelled it a patriotic duty.

Even for the domestic listing though, there are reports the firm is struggling to attract foreign institutional investors, amid an uncertain outlook for the energy sector and questions over company disclosures and governance.

In its prospectus released last week, the company lists a variety of risks ranging from terrorist attacks to geopolitical tensions in a region dominated by Saudi-Iran rivalry.

One striking element was a warning that global oil demand may peak within the next 20 years, citing a forecast from industry consultant IHS Markit.

It also acknowledged that climate change concerns could reduce the demand for hydrocarbons.

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Agencies
May 1,2020

Saudi Arabia has initiated refund of work visa fee to foreigners unable to travel to the Kingdom due to the suspension of international flights in the aftermath of Covid-19 pandemic.

Several work visas were cancelled, following which the Ministry of Human Resources and Social Development, in cooperation and coordination with the Ministry of Foreign Affairs, announced the refund. The cancellation and refunding of the stamped visas will be considered effective from the date of issuance of the royal decree on March 18, reported Saudi Gazette.

As a precautionary measure to curb the spread of coronavirus, the Kingdom suspended all international flight. The ministry of health in Saudi Arabia on Wednesday announced 1,325 new Covid-19 coronavirus cases and 169 recoveries. With this, the total number of cases in the Kingdom now stands at 21,402, while recoveries stand at 2,953, as on Wednesday reported KT.

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News Network
May 20,2020

Cairo, May 20: A senior Kuwaiti lawmaker has called for imposing a tax on expatriates’ remittances to shore up the country’s finances.

MP Khalil Al Saleh, the head of the parliament’s Human Resources Committee, has presented a draft law on the proposed tax to the legislature.

“Imposing fees on expatriates’ transfers will have a role in improving the state's revenues and diversify sources of income,” he told Al Rai newspaper.

Migrant workers transfer about 4.2 billion dinars annually from Kuwait, he added, citing figures from Kuwait’s Central Bank.

“This system is in effect in most countries of the world and in more than one Gulf country. Expats there have not objected to it. Allowing this money to exit the country is very dangerous and has a direct effect on economy,” MP Al Saleh said.

“We do not target brotherly expats because imposing symbolic fees on financial transfers will not affect their money, but will have a positive effect on the state’s sources,” he said. “This has become a necessity after the money transferred outside Kuwait has reached 4.2 billion dinars annually without the state [Kuwait] making any benefit from this.”

Foreign workers make up 3.3 million of Kuwait’s 4.6 million population.

Several Kuwaiti public figures have recently pushed for redrawing the demographic imbalance in the country, accusing expatriates of straining health facilities and increasing the Covid-19 threat.

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News Network
April 10,2020

Dubai, Apr 10: Saudi Arabia reported 364 new coronavirus cases and three new virus-related deaths, the Ministry of Health announced on Friday.

The total number of confirmed cases in the Kingdom is 3,651, out of which 2,919 are currently active, the ministry added.

Out of the new cases, 90 were recorded in Mecca, 78 in Medina, 69 in Riyadh, and 54 in Jeddah, the ministry said.

Meanwhile, the number of fatalities rose to 47, while th number of recoveries reached 685.

The daily number of confirmed cases in Saudi Arabia has not peaked yet, and has been rapidly accelerating.

Saudi Arabia’s Minister of Health had said earlier this week that four different studies showed that the number of coronavirus cases in the Kingdom could reach between 10,000 to 200,000 within weeks.

The ministry spokesman emphasized the urgent need for citizens and residents to remain at home and maintain social distancing practices to ensure that the virus does not spread further.

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