Saudi Aramco, the world’s largest integrated oil and gas company, announced Sunday its intention to proceed with an initial public offering on the Main Market of Tadawul. The Government intends to sell a portion of its Shares in Saudi Aramco.
The CMA (Capital Market Authority) approved the Saudi Aramco’s application for the initial public offering on 3 November 2019. The price at which all subscribers in the Offering will purchase Shares will be determined at the end of the book-building period.
Saudi Aramco is the world’s largest integrated oil and gas company with a unique investment proposition. The Company’s crude oil production accounted for approximately one in every eight barrels of crude oil produced globally from 2016 to 2018.
The operating cash flow of the company for the year ended December 2018 stood at $121 billion while the net income for the same period was $111.1 billion.
The Company is committed to delivering sustainable and growing dividends to its shareholders through crude oil price cycles. Subject to the Board’s discretion after consideration of a number of factors, the Board intends to declare aggregate ordinary cash dividends of at least $75.0 billion with respect to calendar year 2020, in addition to any potential special dividends.
In addition, to the extent that the Board determines that the amount of any quarterly cash dividend declared with respect to calendar years 2020 through 2024 would have been less than $0.09375 per Share (based on 200,000,000,000 Shares outstanding) but for the Government forgoing its rights to such dividend as follows, the Government will forgo its right to receive the portion of cash dividends on its Shares equal to the amount necessary to enable the Company to first pay the minimum quarterly cash dividend amount described above to holders of Shares other than the Government. The remaining amount available for distribution with respect to such quarter as determined by the Board in its discretion will then be distributed to the Government.
Yasir Othman Al-Rumayyan, Chairman of the Board of Directors of Saudi Aramco
and Governor of the Public Investment Fund in a statement said, “Today marks a significant milestone in the history of the Company and important progress toward delivering Saudi Vision 2030, the Kingdom’s blueprint for sustained economic diversification and growth.”
He said since its formation, Saudi Aramco has become critical to global energy supply. With a focused, long-term strategy and staunch governance, Saudi Aramco demonstrates world-class standards of operational performance and financial discipline.
The Company’s strategy is underpinned by long-term, exclusive access to the Kingdom’s unique hydrocarbon resources, which it manages in order to optimize production and maximize long-term value. At the same time, the Company seeks to preserve the low carbon intensity of its crude oil production to demonstrate its ongoing commitment to sustainability, he said.
“The Company has a strong track record of creating value for its current shareholder, the Government. I look forward to welcoming new shareholders who, I am confident, will benefit from the Company’s reliability and continued growth,” the chairman said.
Amin H. Nasser, President and Chief Executive Officer of Saudi Aramco said “Saudi Aramco’s vision is to be the world’s pre-eminent integrated energy and chemicals company. Over the last three years, we were responsible for one in every eight barrels of crude oil produced globally and our proved liquids reserves, at the end of 2018, were five times larger than the combined proved liquid reserves of the Five Major IOCs. We are a steadfast contributor to the world’s energy security.”
Aramco CEO said our mission is to provide our shareholders with long-term value creation through crude oil price cycles by maintaining our pre-eminence in oil and gas production, capturing additional value across the hydrocarbon value chain and profitably growing our portfolio.
He said building on our position amongst the world’s least carbon intense sources of crude oil, Saudi Aramco aims to grow its business sustainability by leveraging technology and innovation to lower our climate impact. We deploy technology, with the aim of producing oil and gas ever more efficiently, reliably and sustainably.
With a comprehensive and disciplined process for capital expenditures, “we seek to maintain a prudent and flexible balance sheet. Our approach delivered higher operating cash flow, higher Free Cash Flow, higher EBIT, higher EBITDA and higher ROACE than each of the Five Major IOCs in 2018. This supports our commitment to sustainable and growing dividends through crude oil price cycles by effectively utilizing our free cash flow while maintaining low targeted gearing ratios.”
A Saudi Aramco statement said the Company’s heritage dates back to 1933 as an upstream venture founded by predecessors to Chevron and ExxonMobil, two of today’s Five Major IOCs. The Company’s upstream operations are based in the Kingdom and it also operates a global downstream business.
SOURCE : ALBILAD
