Saudi Aramco sought to underpin the targeted $2 trillion valuation for its initial public offering by increasing dividends, paying less tax and finding cornerstone investments from major Asian oil producers.
The moves, which came as the state-run company said it had restored all output halted by attacks on its main crude-processing facility last month, show preparations are accelerating for the listing, with the aim of offering shares on the Saudi bourse as soon as November.
The IPO is the centerpiece of Crown Prince Mohammed Bin Salman's plans to revamp the Saudi economy and release billions in capital for the kingdom's sovereign wealth fund. The efforts to make Aramco a more appealing investment and guarantee demand for shares come amid skepticism that the prince's valuation is attainable.
Should the kingdom meet that target, the proposed payout of $75 billion next year would still leave dividend yields below those already offered by competitors like Exxon Mobil Corp. and Royal Dutch Shell PLC. While Aramco is the world's most profitable company and produces about 10% of the world's oil, it also carries greater risks, as illustrated by the drone and missile strike on key facilities in September.