Saudi Aramco shares trade higher after share offering

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Saudi Aramco’s shares gained on Sunday, the first trading day after a secondary share offering expected to raise at least $11.2bn.

The shares opened at SAR27.95 a share, after closing the previous session on Thursday at SAR28.3, but climbed to SAR28.35 by 0730 GMT. The secondary share sale’s final price was set at SAR27.25, towards the lower end of the given price range.

Saudi Arabia placed over half of the Aramco share sale with foreign investors, two people with knowledge of the matter told Reuters on Saturday. One of them said multiple orders came from the US, the UK, Hong Kong, and Japan.

The world’s top oil exporter has been seeking to bring in international investment to pour tens of billions of dollars into projects to diversify away from its reliance on oil. Yet foreign investment has repeatedly missed targets.

Read: PIF partners with Blackrock to explore investments in Saudi Arabia, Middle East

The kingdom’s Vision 2030 programme’s various endeavours which include diverse projects such as electric vehicles to building futuristic cities in the desert, mainly via the Public Investment Fund (PIF).

The $925bn sovereign fund, after scaling back some of its flagship giga-projects, aims to sharpen its focus to drive forward the vision.

Proceeds from the share sale are likely to be funnelled to the PIF, sources and analysts have said, though funds could also help plug the kingdom’s budget deficit which has risen as the oil price has weakened.

Read: Over half of Aramco share sale allocated to foreign investors