Ellen R. Wald, Columnist

Aramco IPO's Local Push May Test Saudi 'Vision'

Sinking too much local capital into the offering risks impeding the kingdom’s greater economic ambitions.

October 29, 2019 at 9:00 AM UTC

Ellen R. Wald is president of Transversal Consulting and a nonresident senior fellow at the Atlantic Council's Global Energy Center.

Saudi Arabia needs robust demand from its own citizenry if Aramco is to achieve anything close to the valuation it wants. — Saudi Arabia needs robust demand from its own citizenry if Aramco is to achieve anything close to the valuation it wants.
Photographer: Simon Dawson/Bloomberg

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As international investors, bankers and executives gather in Riyadh this week for Saudi Arabia’s signature investment summit, the kingdom’s plans for selling shares in its state-owned oil company, Saudi Aramco, will be high on the list of talking points.

Aramco’s journey to the public market has been less than smooth. The latest wrinkle came earlier this month when international investors’ skepticism over its desired $2 trillion valuation forced a delay in the initial public offering. Despite the setback, Saudi Arabia is determined to push ahead with the Aramco IPO this year. Saudi television news channel Al Arabiya reported Tuesday that the sale process will begin on Sunday, with shares of Aramco set to start trading on the local stock exchange on Dec. 11.