Saudi Aramco IPO is born!
Updated: Jul 19, 2020
The Saudi Aramco IPO has been priced, giving the company a valuation of $1.7 trillion off an order book that apparently was 4.7x oversubscribed (order book of $119 bin according to #bloomberg, link for Bloomberg story). The company raised $24.7 bin, the most ever raised in an IPO, representing 1.5% of the company. The rest of the company remains firmly in the hands of the KSR. Never mind that the shares were sold mainly in Saudi Arabia to retail investors and - from a "professional" investor perspective, almost exclusively to "friends & family" in Saudi Arabia (and perhaps a smattering in the broader GCC). At $1.7 trillion, this is way over-valued in my opinion, as I see fair value in the $1.3 trillion to $1.4 trillion range based on a comparable analysis and certain qualitative attributes. See my post from Nov 19th on emorningcoffee.com and on LinkedIn (full article if you're one that likes detail!) in the run-in to this transaction, should you want to know more about how I am looking at this one.