Liam Denning, Columnist

Another Reason to Be Skeptical of a Saudi Aramco IPO

The state oil giant buying Sabic already undermined its story. Backing away from the bond market would weaken it even more.

November 19, 2018 at 5:50 PM UTC

By Liam Denning

Liam Denning is a Bloomberg Opinion columnist covering energy. A former banker, he edited the Wall Street Journal’s Heard on the Street column and wrote the Financial Times’s Lex column.

Saudi Aramco is sending mixed messages.
Photographer: Fayez Nureldine/AFP/Getty Images

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Saudi Aramco buying Sabic is the perfect illustration of what has gone wrong with the long-promised Aramco IPO. So reports of difficulties around financing the acquisition are … more perfect?

Saudi Arabian Oil Co. is said to be backing away from a giant corporate bond issue to fund the purchase of a majority stake in Saudi Basic Industries Corp., according to a report from Dow Jones on Monday morning. Among other things, the slide in oil prices and concerns about disclosure requirements are reportedly leading Aramco to consider alternatives, such as a syndicated loan.