A long way to go for Aramco

The successful initial domestic listing of Saudi Aramco cannot disguise potential challenges—not least security and geopolitical threats—facing the IPO further down the line

Oil producing heavyweight Saudi Aramco auctioned an additional 450mn shares on 12 January via a greenshoe option— the provision in an underwriting agreement that grants the underwriter the right to sell investors more shares than initially planned by the issuer if the demand for a security issue proves higher than expected. The move drove up the value of its December 2019 IPO, already a world record, to $29.4bn for 1.725pc of the company sold.  Yet the spectacular success of the auction, which surprised many observers, has been clouded by spiralling regional tensions which drove Aramco’s share price down in early January 2020, even as the value of international oil companies (IOCs) briefly s