Saudi Aramco’s forthcoming listing on the local stock market could help strengthen the government’s net asset position, with the proceeds potentially raising the Kingdom’s longer-term economic growth, Standard & Poor’s (S&P’s) Global Ratings said.
The world’s most profitable company starts a share sale on November 17 in an initial public offering (IPO) that may raise between $20 billion and $40 billion.
“The bulk of the funds raised will go to the government or the Public Investment Fund, potentially adding to the sovereign’s already strong fiscal net asset position of 72.7 percent of GDP,” S&P said in a note published by Reuters.
“Productively deployed, we believe the assets could also help maintain growth potential through our three-year ratings horizon.”
S&P Global rates Saudi Arabia as A-/A-2 with a stable outlook.
Separately, some Saudi banks have announced that they will be extending by two the working hours in all branches participating in the IPO.
Some banks in the eastern regions of the country announced the extension of work for three hours to give the opportunity for those coming from abroad to contribute to the IPO.
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