Saudi Crown Prince Mohammed bin Salman at a September meeting in Jeddah, Saudi Arabia. Photo: Mandel Ngan/AFP via Getty Images

Saudi Arabia has approved the long-anticipated initial public offering of state-owned oil giant Aramco, the kingdom's market regulator announced in a statement Sunday.

Why it matters: This could be the biggest IPO ever. Aramco is responsible for about 10% of the world’s oil production, per Bloomberg, which notes it "generated the most profit of any corporation last year with net income of $111 billion — more than Apple Inc., Google’s parent Alphabet Inc. and Exxon Mobil Corp. combined."

  • Per Axios' Ben Geman, "offering a small slice of the company is designed to raise tens of billions of dollars to fund the kingdom's economic diversification efforts. But the plan to list up to 5% of Aramco has been beset with delays since the crown prince first made the announcement in 2016."

The big picture: Bloomberg and Reuters first reported that Saudi Crown Prince Mohammed bin Salman gave the green light on Friday for what could potentially be the world's biggest IPO, after spending over three years considering the action.

Between the lines: Aramco shares will be first traded on Riyadh’s Tadawul stock exchange and other stocks will later be put on a foreign exchange, AP reports.

  • Aramco is aiming for a valuation of $2 trillion valuation, though "some analysts see about $1.5 trillion as more realistic," Bloomberg notes.
  • Sources told Reuters Aramco "could sell 1%-2% of its shares on the local bourse, raising as much $20 billion-$40 billion."

Editor's note: This article has been updated with new details throughout.

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