Saudi Arabia transfers 4 percent of Aramco shares to sovereign wealth fund

Saudi Arabia’s Crown Prince Mohammed bin Salman has transferred four percent of Saudi Aramco to the Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, the government said on Sunday.

The Crown Prince said the state remains the largest shareholder in Saudi Aramco after the transfer process, as it retains more than 94 percent of the company’s shares.

A 4 percent stake would be worth nearly $80 billion, based on the company’s market capitalization.

The transfer of existing shares would help to boost PIF’s assets under management, which are targeted to grow to about 4 trillion riyals ($1.07 trillion) by the end of 2025, the Crown Prince said in a statement.

Saudi Aramco said in a statement the transfer was a private transaction between the government and the state fund. “The company is not a party to the transfer and did not enter into any agreements or pay or receive any proceeds from that transfer,” it said.

It said the move would not affect the number of issued shares or the company’s operations, strategy, dividends distribution policy or governance framework. It added that the shares transferred would rank equally among other existing ordinary shares.

Saudi officials had previously raised the possibility of Aramco share sales. The PIF did not comment.

The head of Saudi Arabia’s sovereign wealth fund Yasir al-Rumayyan said last year that Saudi Aramco may consider selling more shares if market conditions are right.

The Wall Street Journal recently reported that the kingdom is planning to list more shares in Aramco and is targeting a stake sale of as much as $50 billion.

Aramco, the world’s biggest oil company, completed the world’s largest initial public offering in late 2019, raising $29.4 billion.

The proceeds of that offer were transferred to the PIF, the Crown Prince’s vehicle of choice to transform the Saudi economy and diversify away from oil revenues.

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