The institutional portion of Saudi Aramco's initial public offering (IPO) on the Saudi Stock Exchange (Tadawul) has received SR144.1 billion ($38.4 billion) in orders, its financial advisers said in a joint statement on Monday. The company has received subscription orders from institutional buyers for around 4.6 billion of shares so far, Samba Capital, NCB Capital and HSBC Saudi Arabia said. Saudi Aramco is offering 1.5 percent of its shares on the Tadawul, with 0.5 percent set aside for retail, or individual investors. The remaining shares are allocated for institutional investors, such as banks or sovereign wealth funds. The company has set an indicative price range of SR30-32 per share ($8-8.53), which would value the oil giant at $1.6 to $1.7 trillion. At this valuation, the company could raise up to $25.5 billion from the IPO. The deadline to subscribe for institutional investors is Dec. 4, with the final price for the offering expected to be announced the next day. Aramco completed the retail portion of its initial public offering (IPO) with SR47.4 billion ($12.64 billion) in orders on Thursday, according to Samba Capital, the IPO's lead manager. Samba said, the shares sold amounted to 1,481,613,280. The firm added that institutional investors had put orders for SR118.86 billion during the first 12 days of the book building process. According to the IPO prospectus, Saudi Arabian retail investors that hold their shares for a minimum of 180 days, or six months, would be eligible for a 10 percent discount through the allocation of additional bonus shares. The proceeds from the listing will go towards diversifying the Saudi Arabian economy away from oil, and could be invested in sectors such as logistics, mining, or developing the manufacturing and industrial economy. Muneera Al-Dossary, chief executive officer of Riyadh-based Mulkia Investment Company, had predicted at the launch of the IPO that Aramco will be on a fast-track inclusion on the global index provider, MSCI — a step that would support the stock price further through demand and liquidity after listing. MSCI, which is used by funds that manage trillions of dollars around the world, recently said that if Saudi Aramco starts trading on the Tadawul on or before Dec. 12, that it would add the company to the MSCI equity indexes from Dec. 17. Otherwise, the company would have to wait to be considered for inclusion after Jan. 5, 2020. — Al-Arabiya Englis/SG
