The first issuance of Saudi Aramco’s international bond offering in April received orders reached up to $100bn, nearly 10 times the required, and so the first issue of the oil giant broke record.
This reflects the global confidence in the financial flows of Aramco and the Saudi economy and its institutions.
Saudi Aramco raised $12bn of 3 to 30-year maturities that attracted demand exceeding $100bn, according to a document issued by one of the bank’s listed for arranging the IPO.
The Saudi oil giant sold $1bn of three-year bonds, offering investors 55 basis points over US Treasuries.
It’s note that bond pricing came in better than expected.
Aramco raised $2bn of five-year bonds at 75 basis points above the same benchmark, $3bn of 10-year notes at 105 basis points, $3bn of 20-year notes at 140 basis points and $3bn of 30-year notes at 155 basis points.
The Reuters news agency said in a report, then, that the turnout, which exceeded the $100bn barrier of an estimated $10billion, is considered a “vote of confidence in the market, breaking a record barrier for the issuance of the oil giant Aramco”.
Demand for Aramco’s bonds is the largest for emerging markets, with Aramco’s bonds attracting demand from a wide range of investors, with the company’s huge profits.
Saudi Aramco chief executive Amin Al-Nasser said at the time that Aramco would not issue more bonds this year after it sold its first international bonds earlier in April for $12bn.
Al-Nasser said future Aramco debt issuance would depend on its funding requirements, but the company would continue to take a cautious approach to managing its budget.