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Riyadh, Dec 6 : Saudi Arabian state oil giant Saudi Aramco on Thursday priced its initial public offering (IPO) at the high end of the targeted range, a level that will allow the company to raise a record total of at least $25.6 billion.

The company plans to sell 3 billion shares, or 1.5 per cent of its total shares, at a price of 32 Saudi riyals ($8.53) per share.

This IPO’s size gives Aramco a market valuation of $1.7 trillion, pushing it ahead of Apple ($1.17 trillion) as the world’s most valuable publicly traded company, Efe news reported.

Trading of Aramco’s shares is expected to begin next week pending an announcement by Riyadh’s stock exchange.

Aramco had previously announced that its shares would not be offered in the United States, Australia, Canada or Japan.

Saudi Arabia has pursued a commitment from wealthy Saudi citizens and regional allies to purchase shares as a gesture of solidarity and goodwill as opposed to an investment decision.

Meanwhile, the kingdom’s banks were directed to double the leverage limit for loans to investors looking to buy Aramco’s shares. Compared to an average leverage-ratio limit for loans of 1 to 1, banks were allowed to lend to retail customers for this purpose at a 2-to-1 ratio.

The company will offer 33.3 percent of the available shares (0.5 percent of Aramco’s total shares) to retail investors, while the remaining 66.7 percent have been allocated for institutional investors.

The IPO was 4.65 times oversubscribed, with total bids of $119 billion, according to sources close to the process.

An additional 450 million Aramco shares could be sold under an over-allotment option for underwriters, which would bring the total amount raised to nearly $30 billion. The previous record IPO ($25 billion) was set in 2014 by Chinese online commerce company Alibaba Group Holding.

Trading of the shares is expected to commence after all relevant legal requirements and procedures have been completed.

The company plans to pay a base dividend of $75 billion in 2020. However, it has cautioned about investment risks that include fluctuating oil prices and the backlash faced by oil companies due to their role in climate change.

The sale has been bolstered by Saudi Arabia’s regional allies, whose participation was a relief to the kingdom after plans to market the IPO globally floundered.

Proceeds from the IPO are needed as the kingdom aims to diversify its economy away from oil and implement domestic socio-economic reforms.

Aramco’s IPO plans were put on hold last year in preparation for Saudi capital market reforms. No information currently exists on where the IPO will be listed abroad.

The IPO may encourage other Gulf Cooperation Council (GCC) state oil companies to carry out their own initial public offerings; however, Abu Dhabi-based ADNOC is expected to only list the shares of its subsidiaries.

Aramco reported net income of $111.1 billion in 2018 and $46.9 billion in the first half of 2019.

The company suffered a damaging drone and missile attack on some of its oil-processing facilities in September of this year.

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Vodafone quits Facebook’s Libra cryptocurrency project

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San Francisco, Jan 22 Telecom major Vodafone has joined the list of top companies which have backed out from Facebook’s controversial Libra cryptocurrency project.

Vodafone joins PayPal, Mastercard, Visa, Mercado Pago, eBay, Stripe and Booking Holdings in withdrawing from the controversial project — and is the first company to exit after the Libra Association was formed in October last year, Coindesk reported on Tuesday.

The companies have left owing to concerns about heightened regulatory scrutiny and users’ data privacy.

“We can confirm that Vodafone is no longer a member of the Libra Association. Although the makeup of the Association members may change over time, the design of Libra’s governance and technology ensures the Libra payment system will remain resilient,” the Libra Association said in a statement.

“The Association is continuing the work to achieve a safe, transparent, and consumer-friendly implementation of the Libra payment system.”

Despite top-notch firms pulling out, Facebook and 20 partner organisations formally joined the digital currency Libra project in Geneva in October.

The Libra Association said that more than 1,500 entities have expressed an interest in joining the digital currency project.

Several US senators have opposed Facebook’s digital coin, arguing that the social networking giant has been irresponsible with user data privacy. They have even called the digital cryptocurrency Libra “delusional” and “dangerous”.

Facebook CEO Mark Zuckerberg testified before Congress in October about Libra, defending the idea, but acknowledging the struggles left to overcome.

In a six-hour grilling at a House Financial Services Committee hearing, both Democrat and Republican lawmakers expressed dissatisfaction with Facebook’s cryptocurrency plans.

“As I have examined Facebook’s various problems, I have come to the conclusion that it would be beneficial for all if Facebook concentrates on addressing its many existing deficiencies and failures before proceeding any further on the Libra project,” said California Representative Maxine Waters.

“Facebook’s internal motto was for a long time ‘move fast and break things.’ Mr. Zuckerberg, we do not want to break the international monetary system,” added New York Democrat Nydia VelAizquez.

Libra has failed in its current form, according to the President of Switzerland.

In a media interview, Swiss President and Finance Minister Ueli Maurer stated that Libra does not have a chance of being successful “because the basket of currencies that is deposited in this currency is not accepted by the national (central) banks”.

“The project in this form has actually failed,” Maurer was quoted as saying.

The Libra project, which is still in development, aims for the launch of its first version this year.

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Vodafone quits Facebook’s Libra cryptocurrency project

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vodafone

San Francisco: Vodafone has become the latest big player who have decided to quit Facebook’s controversial Libra cryptocurrency project.

Vodafone joins PayPal, Mastercard, Visa, Mercado Pago, eBay, Stripe and Booking Holdings in withdrawing from the controversial project — and is the first company to exit after the Libra Association was formed in October last year, coindesk reported on Tuesday.

The companies left owing to concerns about heightened regulatory scrutiny.

“We can confirm that Vodafone is no longer a member of the Libra Association. Although the makeup of the Association members may change over time, the design of Libra’s governance and technology ensures the Libra payment system will remain resilient,” the Libra Association said in a statement.

“The Association is continuing the work to achieve a safe, transparent, and consumer-friendly implementation of the Libra payment system.”

Despite top-notch firms pulling out, Facebook and 20 partner organisations formally joined the digital currency Libra project in Geneva in October.

The Libra Association said that more than 1,500 entities have expressed an interest in joining the digital currency project.

Several US senators have opposed Facebook’s digital coin, arguing that the social networking giant has been irresponsible with user data privacy. They have even called the digital cryptocurrency Libra “delusional” and “dangerous”.

Facebook CEO Mark Zuckerberg testified before Congress in October about Libra, defending the idea, but acknowledging the struggles left to overcome.

Libra has failed in its current form, according to the President of Switzerland.

In a media interview, Swiss President and Finance Minister Ueli Maurer stated that Libra does not have a chance of being successful “because the basket of currencies that is deposited in this currency is not accepted by the national (central) banks”.

“The project in this form has actually failed,” Maurer was quoted as saying.

The Libra project, which is still in development, aims for the launch of its first version this year.

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Markets open on a positive note on Wednesday morning

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Mumbai: The 30-scrip Sensitive Index (Sensex) on Wednesday opened on a positive note.

The Sensex of the BSE opened at 41,467.13 points and touched a high of 41,532.29 points. The Sensex touched a low of 41,451.71 points.

On Tuesday the Sensex closed at 41,323.81 points.

The Sensex was trading at 41,466.43 points up by 141.73 points or 0.35 per cent at 9.26 a.m

On the other hand, the broader 50-scrip Nifty at National Stock Exchange (NSE) opened at 12,218.35 points after closing at 12,169.85 points on Tuesday.

The Nifty is trading at 12,203.35 points on Wednesday morning at 9.29 a.m.

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