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State-owned oil company Saudi Aramco said on Sunday it has exercised its “greenshoe option” to sell an additional 450 million shares, raising the size of its initial public offering (IPO) to a record $29.4 billion.
A greenshoe option, or over-allotment, allows companies to issue more shares in an IPO when there is greater demand from participants during the initial offering.
Investors were allocated the additional shares for the option during the book-building process, Aramco said.
Aramco said “no additional shares are being offered into the market today and the stabilizing manager will not hold any shares in the company as a result of exercise of the over-allotment option.”
Shares of Aramco fell to 34 riyals on Jan. 8, its lowest since the stock began trading on Dec. 11, but closed at 35 riyals on Thursday.
Thursday’s closing price valued Aramco at $1.87 trillion, above the IPO price, which valued the company at $1.7 trillion, but below Crown Prince Mohammed bin Salman’s coveted $2 trillion target.
(Source CNBC)(Source Bloomberg)(Source Reuters)