Aug 20, 2019 - Economy & Business

Report: Saudi Aramco selects advisers for its IPO revival

The Saudi Aramco oil field complex facilities at Shaybah in the Rub' al Khali.

The Saudi Aramco oil field complex facilities at Shaybah in the Rub' al Khali. Photo: Reza/Getty Images

Saudi Aramco is selecting advisers to try to move forward on its on-again, off-again, on-again plans for a mammoth IPO, Bloomberg reports.

Why it matters: The listing of a slice of Aramco could be the largest IPO in history, and the proceeds are meant to help fund the kingdom's plans to diversify its crude-dominated economy.

  • Saudi officials have said they're looking to hold the IPO in 2020 or 2021 after shelving what had been plans for an offering in the 2018 timeframe.
  • "Saudi Aramco has picked Lazard Ltd. and Moelis & Co. to advise on the oil giant's second attempt at the world’s largest initial public offering," they report, citing unnamed people with knowledge of the matter.

But, but, but: All kinds of questions remain about the plans first announced in 2016, including the listing venue and Aramco's ability to hit anything close to their hoped-for $2 trillion valuation.

Meanwhile, Reuters has an interesting new piece this morning about how global warming could create hurdles for Saudi Aramco's plan to list 5% of the company, which the kingdom hopes will bring in up to $100 billion.

The big picture: "[S]ome investors and lawyers say the window to execute a sale at a juicy price is shrinking and Aramco will need to explain to prospective shareholders how it plans to profit in a lower-carbon world," they report.

The intrigue: The Saudis argue that their oil is well-positioned even in an increasingly carbon-conscious world because their emissions per extracted barrel are lower than other big producers.

Go deeper: Saudi Arabia touts its crude oil CO2 edge

Go deeper