Saudi Aramco has officially set the record for the largest initial public offering in history.
The Saudi oil giant set the final price for its shares at the top end of the anticipated range, placing the value of the state-owned oil company at $1.7 trillion U.S. That valuation makes Saudi Aramco the biggest IPO ever.
Shares of Saudi Aramco have been priced at 32 riyals ($8.53 U.S.), according to a statement from the company. The IPO is currently 4.65 times oversubscribed, with most of the money coming from local investors. However, Saudi Aramco has not yet said when its shares will begin trading on the Riyadh stock exchange.
The deal ended up being a very different one from what was originally envisaged. Saudi Aramco offered just 1.5% of its shares and Saudi Arabia had to trim its ambitions after global investors balked at the kingdom’s hopes of valuing the company at $2 trillion U.S.
Instead, Aramco relied heavily on Saudi investors. In the retail offering, 4.9 million people applied for shares. The institutional tranche closed on Wednesday and attracted bids totalling 397 billion riyals.
Aramco will become the world’s most valuable publicly traded company once it does start trading, overtaking both Microsoft Corp. and Apple Inc. (NASDAQ:AAPL) Proceeds from the IPO are to be transferred to Saudi Arabia’s "Public Investment Fund," which has been making a number of investments lately, putting $45 billion U.S. into SoftBank Corp.’s Vision Fund, taking a $3.5-billion U.S. stake in Uber Technologies Inc. (NYSE:UBER) and planning a $500-billion U.S. futuristic city.
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