A week after its inception, Aramco IPO breaks all records

Samba Capital and Investment Management Company (SambaCapital), as Saudi Aramco IPO lead manager, announced the results of the retail subscription as of 5 pm on November 25, 2019, where the number of individual subscribers during the period reached 2,628,646 subscribers with a total number of 680,254. 540 shares, representing SAR21,768,145,280.

  • More than 2.6 million individuals have injected over SAR21.7bn.

The following is an indication of the percentage of subscription through subscription channels available to individuals:

Telephone banking: 1.85%
ATM: 24.76%
E-Banking: 38.26%
Branches: 35.14%

The last day of subscription for the individual category is next Thursday November 28, 2019.

On the other hand, Rania Nashar, SambaCapital CEO, said the turnout for the company’s shares witnessed positive and active participation rates, supported by the confidence of citizens and individual investors in the investment value of the company.

Aramco also held meetings with investors in Dubai this week, news agencies reported.

Subscription Commencement

The application period and the subscription process for individual underwriters in Aramco’s IPO commenced on November 17, at the same time of the start of the application period and the process of book building for investing institutions from November 17, 2019 to December 4, 2019.

Aramco said it aims to sell a maximum of 0.5% of its shares to individual investors in the IPO, while 1% will go to investing institutions.

Aramco’s IPO will raise $24-$25.6bn.

Price range

Saudi Aramco announced earlier this week the price range for the IPO and the start of the book building for the investing institutions and individual subscribers’ segments.

While the official announcement of the IPO price of the subscribed shares will be on December 5, as follows:

  • The offer price range has been set between SAR30 to SAR32 per share.
  • The final offering price will be determined at the end of the period of book building. Subscription of individual investors segment will be priced at SAR32 per share, the upper limit of the price range.
  • The offering will also be 1.5% of the total shares of the company.

In case the final offer price is less than SAR32, individual subscribers shall, in respect of the difference between the upper limit of the price range and the final offer price, have the option of: (a) obtaining the cash surplus by reimbursing the individual subscriber; or (b) the possibility of allocating additional shares to the individual subscriber.

It’s noteworthy that Aramco’s IPO price range is between $1.6 and $1.7tn.

Aramco’s dividend yield will be at least 4.4% to 4.7% next year.

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