Aramco’s sale attracts foreign investments unlike 2019’s

Foreign investors eagerly embraced Saudi Aramco‘s $12 billion share sale, contrasting with its 2019 debut that ended up as a local affair, Bloomberg said in an article.

Significant interest came from overseas, including strong demand from Asian investors, reflecting the kingdom’s burgeoning ties with major Asian economies like China and India. Locally, interest remained robust.

Despite mounting climate change concerns, Aramco’s status as the world’s largest oil company has become more appealing to investors. Its substantial dividend, alongside ambitious investment plans in renewable energy, petrochemicals, and gas, attracted investors seeking value.

Institutional investors had until Thursday to place orders, with the deal covered within hours of opening on Sunday. Foreign participation will be closely monitored, with Aramco’s executives engaging in promotional events in the UK and the US.

During a London event, attended by senior bankers from major institutions, Aramco’s CEO highlighted the company’s dividend yield, enticing potential investors.

Previously, overseas investors hesitated due to valuation concerns, leaving the government to rely on local buyers during the IPO. Despite plans for international marketing, the majority of shares were allocated domestically.

Following the offering, the Saudi government will retain the majority stake, aligning with its fiscal objectives to raise capital and address budget deficits.