Latest reports from Reuters News claims that Saudi Arabia has canceled the proposed public listing of Saudi Aramco, its state-owned oil corporation.
The report claimed that Saudi Arabia has also disbanded the financial advisors for the deal.
According to unnamed sources, the country will instead buy a strategic stake in Saudi Basic Industries Corp., two of the sources said.
“The decision to call off the IPO was taken some time ago, but no-one can disclose this, so statements are gradually going that way – first delay then calling off,” a Saudi source familiar with the IPO plans said.
Saudi Aramco did not immediately respond to an emailed request for comment. The Saudi Royal Court had no immediate comment.
It could be recalled that Crown Prince Mohammed bin Salman, had announced the decision to list about 5% stake in Saudi Aramco as part of the broader reform to restructure the kingdom’s economy and reducing its dependence on oil revenue.
“The message we have been given is that the IPO has been called off for the foreseeable future,” said one of the sources, a senior financial advisor.
“Even the local float on the Tadawul Stock Exchange has been shelved,” the source added.
Saudi energy minister and Aramco chairman Khalid Al Falih said in the company’s 2017 annual report, released in August, that Aramco “continued to prepare itself for the listing of its shares, a landmark event the company and its board anticipate with excitement.”
Aramco had a budget which it used to pay advisors until the end of June. This has not been renewed, one of sources said.
“The advisors have been put on standby,” a third source, a senior oil industry official said.
“The IPO has not been officially called off, but the likelihood of it not happening at all is greater than it being on.”