Saudi Aramco courts foreign investors with roadshows in US, London

The firm is planning a separate event in the US, the people said, declining to be identified as the information is private. Institutional investors can submit orders until June 6 for the share sale that kicked off Sunday.

The $1.8 trillion oil giant’s offer was covered in just a few hours after the deal opened. It wasn’t immediately clear how much demand came from overseas, though the order book reflected a mix of local and foreign investors, Bloomberg News reported.

The extent of foreign participation will be closely watched. During Aramco’s 2019 initial public offering, overseas investors had largely balked at valuation expectations and left the government reliant on local buyers.

The IPO eventually drew orders worth $106 billion, and about 23% of shares were allocated to foreign buyers.

A top selling point this time around is the chance to reap one of the world’s biggest dividends. Investors willing to look past a steep valuation and the lack of buybacks would cash in on a $124 billion annual payout that Bloomberg Intelligence estimates will give the company a dividend yield of 6.6%.

The Saudi government owns about 82% of Aramco, while the Public Investment Fund holds a further 16% stake. The kingdom will continue to be the main shareholder after the offering, which adds to Riyadh’s efforts to raise cash and fill a budget deficit.