Saudi Aramco set to be valued at more than $2 trillion as Saudi Arabia confirms five per cent stake sale
Saudi Aramco, the Kingdom of Saudi Arabia's state owned oil company, will be valued at over $2 trillion (£1.38 trillion) when less than five per cent of the company is sold through an initial public offering.
The valuation would make it the most valuable company in the world, over taking Apple which has a market capitalisation of $607bn.
The world's largest publicly listed oil company is currently Exxon Mobil, sporting an $351bn valuation.
Saudi Arabia deputy crown prince Mohammed bin Salman made the announcement on a television interview this morning.
He said he wanted Aramco, which has long been thought to be the worlds most valuable company, to be transformed into a holding company with an elected board and all financial information will be disclosed. Saudi Aramco has never before disclosed the extent of its oil reserves.
The move is part of the so-called Saudi Vision 2030, a plan seeking to reduce the reliance on revenue from crude oil exports.
The prince claimed the Kingdom will be able to live without oil by 2020, and that plans were not dependent on a recovery in the oil price.
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Oil has lost over 60 per cent in value since mid 2014 after the Kingdom led Opec in a refusal to prop up the price by cutting production.
Oil is currently trading at $44.30 per barrel of Brent crude, up from January lows of $27. In August 2014 oil hit highs of $114 per barrel.
A global supply glut has so far refused to budge, though experts think that a slow down in US shale production means that by the second half of 2016 stocks should begin to fall.
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King Salman, the father of prince Mohammed, has approved the package of developmental, economic, social and other programmes, it was reported following a Bloomberg interview with Prince Mohammed in Riyadh last week.
The National Transformation Program, headed by prince Mohammed, is expected to be launched within 45 days of today's announcement, and will seek to hold government offices more accountable, boost economic growth, create jobs, and attract outside investors.
The plans have faced scepticism that the country will be able to rein in spending in a country that has become accustomed to government largesse.
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Plans also include structure subsidies, a value-added tax, as well as a levy on energy and sugary drinks and luxury items.