Saudi Aramco's bond sale sets record as orders top $100bn

Saudi Aramco, the world’s largest oil company, was massively oversubscribed for its multibillion dollar debut bond sale, in a further sign that investors have put aside concerns over doing business with Saudi Arabia following the murder of the journalist Jamal Khashoggi.

The state-owned firm is expected to raise more than $10bn (£8bn) through its first-ever bond issue. But a surge in demand meant the sale was oversubscribed, with orders exceeding $100bn.

It reportedly sets a record for emerging market bond demand, trumping orders worth $52bn for Qatar’s $12bn deal last year, $67bn bid for Saudi Arabia’s bond sale in 2016 and $69bn for Argentina’s $16.5bn trade that same year.

The stampede to pick up Aramco debt is seen as a vote of confidence by investors, just months after Khashoggi was killed in a Saudi consulate in Istanbul last October.

Saudi authorities spent weeks denying any knowledge of the journalist’s death before saying he was killed in an operation masterminded by former advisers to Mohammed bin Salman, but denying the crown prince’s involvement.

The journalist had written columns for the Washington Post criticising the crown prince before his death.

Some investors initially tried to distance themselves from the Gulf state amid global outrage, pulling out from a major finance conference in Riyadh in October.

Saudi Aramco last week emerged as the most profitable business in the world, with its 2018 profits of $111.1bn overtaking Apple at $59.5bn.

Documents from its bond offering revealed the company produced 10.3m barrels of crude oil per day, resulting in annual revenues of $355.9bn.

Proceeds from Saudi Aramco’s bond sale are expected to help fund its takeover of rival Sabic in a deal worth $69.1bn.

The Guardian