Saudi Arabia has called off Aramco float, reports suggest

Saudi Aramco

Saudi Aramco

Khalid Al Falih, the Saudi energy minister, issued the statement early on Thursday insisting "speculation surrounding the cancellation of the IPO as not true.' He stated Saudi remains committed to the IPO, but said the listing would go ahead 'at a time of its own choosing, when conditions are optimum'".

Saudi Arabia calls off both domestic and global stock listing of state oil giant Aramco, sources tell Reuters.

It is all part of Crown Prince Mohammed bin Salman's plan to open up the Saudi Arabian economy to worldwide investors. Riyadh predicted the sale would result in Aramco being valued at $2 trillion or more in total. That will replace at least some of the money the Public Investment Fund had been expected to receive from the Aramco IPO. Skepticism grew earlier this year when sources familiar with the process said Aramco would first list on its domestic exchange, the Tadawul, and postpone an worldwide listing.

Aramco, as the company is commonly called, plans to delay the IPO to concentrate on buying a stake in chemical manufacturer Saudi Basic Industries, Bloomberg reported Wednesday.

A request by Middle East Eye to comment on the report was not immediately acknowledged by Saudi Arabia.

Crown Prince Mohammed first made the plans public in January 2016, when he was still the kingdom's deputy crown prince. Oil prices have also been a problem. The rout pushed Saudi Arabia's budget into a deficit and ultimately forced the kingdom to coordinate production cuts among roughly 24 oil-producing nations.

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The Aramco IPO has been a centerpiece of Crown Prince Mohammed's reform program to diversify the country's economy away from oil, known as Vision 2030.

Stock exchanges in New York, Hong Kong and London were among those jockeying to host the listing.

US President Donald Trump openly lobbied for a listing on the New York Stock Exchange via Twitter.

The flotation was originally expected to take place in the second-half of this year, but in March, Mr al-Falih delayed the IPO to the second quarter of 2019.

It was thought then that the government might instead sell Aramco shares privately to the world's biggest sovereign wealth funds and institutional investors.

Aramco will raise funds from banks and worldwide bondholders to buy a controlling stake in the petrochemical group.

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