September 25, 2017 / 2:23 PM / 10 months ago

Saudi finance minister tells bond investors Aramco IPO to go ahead in 2018

DUBAI (Reuters) - Saudi Finance Minister Mohammed al-Jadaan told bond investors during a presentation on Monday that the initial public offering (IPO) of Saudi state oil giant Aramco will proceed as planned in 2018, sources familiar with the matter told Reuters.

FILE PHOTO: Logo of Saudi Aramco is seen at the 20th Middle East Oil & Gas Show and Conference (MOES 2017) in Manama, Bahrain, March 7, 2017. REUTERS/Hamad I Mohammed/File Photo

Aramco has previously said the listing remained “on track” after a report that the oil company was preparing contingency plans for a possible delay into 2019.

Saudi Arabia held the global investor call in preparation for a potential third international bond issuance, having issued a $17.5 billion international bond last year and a $9 billion sukuk in April.

Saudi authorities aim to list up to 5 percent of the world’s largest oil producer on the stock exchange in Riyadh, the Tadawul, and one or more international markets in an IPO that could raise $100 billion.

The listing and bond issuance are both part of a massive economic reform effort to diversify the kingdom’s sources of state revenues amid protracted low oil prices, which have caused large budget deficits.

Saudi Arabia also plans to introduce of a value-added tax (VAT), which Jadaan said the government is ready to implement as scheduled at the start of 2018.

Details of the Citizen’s Account, a household allowance scheme intended to reduce the impact of austerity policies on low and middle-income Saudi families, would be announced in the coming weeks, he said.

Reporting by Katie Paul and Davide Barbuscia; Editing by Mark Potter and David Goodman

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