Apple is no longer the largest company in the world as measured by market capitalization. Nor is software giant Microsoft. The title has shifted to Saudi Arabian Oil Co. or Saudi Aramco. The largest oil company in the world priced its initial public offering giving it a massive market capitalization of about $1.7 trillion. Just like that, a new company takes the crown. And by a lot. There is more than an Alibaba Group Holding amount between Apple (AAPL) and Aramco.
Trading on the Saudi Tadawul stock exchange came after a mammoth $25.6 billion initial public offering that set the record as the biggest ever in history, overtaking the $25 billion raised by China's Alibaba in 2014. Demand during the book-building period for Aramco's IPO reached $106 billion with most of that generated by Saudi investment.
Aramco, owned by the state, has sold a 1.5% stake in the company, pricing its shares before trading at 32 Saudi riyals, or what is $8.53. At pre-trading auction earlier in the morning, bids for Aramco had already reached the 10% limit on stock price fluctuation allowed by Tadawul. That pushed the price of Aramco shares in opening moments to 35.2 riyals, or $9.39 a share, where it held until closing at 3 p.m. The IPO can be counted as a success, wrote Edward Moya, senior market analyst at financial services company OANDA, in a Wednesday research note.
It took four years to get this IPO done, but the Saudis have successfully made the world's largest oil producer reach a market cap of $1.88 trillion, very close to the Crown Prince's initial goal of $2 trillion,
Moya noted, referring to Crown Prince Mohammed bin Salman.
