DUBAI / RIYADH (Reuters) – Saudi Crown Prince Mohammed bin Salman agreed on Friday to announce the initial public offering of state oil giant Saudi Aramco on Sunday, five sources familiar with the matter told Reuters.
Aramco, the world’s largest oil company, will announce its plan to launch on November 3, the sources said.
“The crown prince finally gave the green light,” one source said.
Aramco declined to comment.
According to sources, Saudi Aramco officials and advisers have held last-minute meetings with investors over the past few days in an effort to reach a valuation as close to $ 2 trillion ahead of an expected listing on Sunday.
The Saudi government held its last meeting on Friday evening to decide whether to proceed with the listing.
Although the crown prince set a valuation of $ 2 trillion in early 2016, bankers and officials say Aramco’s valuation is close to $ 1.5 trillion.
But even at that price, Aramco would still be worth at least 50 percent more than the world’s two most valuable companies – Microsoft and Apple, which have a market capitalization of about $ 1 trillion.
Riyadh is seeking to raise the initial listing of a 1 to 2 percent stake in the Saudi bourse at least $ 20 billion to $ 40 billion. If the value exceeds $ 25 billion, this will be the largest IPO in the world and exceeds the initial public offering of Chinese company Alibaba in 2014, which raised $ 25 billion.
Inclusion is the cornerstone of the Crown Prince’s plan to bring about a comprehensive change in the Saudi economy by diversifying its sources away from oil. But it has been postponed several times since it was first announced in 2016.
Prince Mohammed wants to eventually list a total of five percent of the company. An international sale is expected to follow the local IPO.
Another source said analysts’ meetings with major institutional investors were likely to start on Sunday.
Aramco also addressed governments in the Gulf and Asia, including the Chinese, to get the bulk of investment from countries with good relations with Saudi Arabia, where sources have previously said that the reaction to the IPO was more cool.