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Saudi Aramco announced on Sunday it has used its “greenshoe option“ to sell an additional 450 million shares. raising its initial public offering (IPO) to a record size of $29.4 billion.
Saudi Arabia-owned Aramco initially raised a then-record $25.6 billion in its IPO in December by selling 3 billion shares at 32 riyals ($8.53). yet indicated that this is not the final number and it might sell additional shares through the over-allotment of shares.
The company said it had used the “greenshoe option“ or over-allotment. an option which allows companies to issue more shares in an IPO when there is greater demand from participants during the initial offering. According to Aramco. during the book-building process. they managed to allocate investors for additional shares.
However. the company added. “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 the exercise of the over-allotment option.“
