The Star Early Edition
News greeted by a fit of laughter
WHEN one financial adviser heard about Saudi Arabia’s plans to list a company larger than the economies of most nations, he had to pull over his car because he was laughing so hard.
The news was greeted with incredulity in the financial industry, according to interviews with a half dozen bankers who do business in the Middle East.
For one thing, Aramco’s inner workings are opaque, making its true value a mystery. Then there’s the timing. The price of crude oil is near its lowest level in more than a decade. Discussions with Aramco about selling assets in the past had been about much smaller parts of the business, five of the people said. An initial public offering of the entire enterprise had only ever been discussed as a joke, one of the people said.
The company could be worth anything from $1 trillion (R16.3trln) to upwards of $10 trillion, which would make it the most valuable company in the world. – Bloomberg