The Abu Dhabi Investment Authority (ADIA) has reportedly met with executives from Saudi Aramco to discuss a potential $25 billion investment in the Saudi oil energy company’s upcoming initial public offering (IPO).
The state-owned Aramco has struggled to land an anchor investor for the flotation and has reportedly met with other sovereign wealth funds such as Kuwait Investment Authority and Singapore’s GIC as well as conducting a roadshow across the GCC.
The IPO, which is a central plank of Crown Prince Mohamed Bin Salman’s economic development plan, could still be the biggest on record, however it has struggled to attract institutional investors outside of the region.
Such has been the lack of international interest that plans for a roadshow outside of the Mena region have bene cancelled.
Aramco is hoping to sell 1.5% of the company in the IPO and has set a base dividend of $75 billion over five years, valuing the company between $1.6 trillion and $1.7 trillion. The valuation has been cut from around $2 trillion but has still been deemed too high by many institutional investors outside the region.
The retail tranche of the IPO, constituting 0.5% of the company, has however been sold, one day ahead of the deadline. According to lead manager Samba Capital, 1,017,816,380 shares have been sold to more than 3.7 million GCC residents and citizens, raising $8.66 billion.
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