Aramco’s base oils subsidiary has received regulatory approval for an IPO

Saudi oil giant Aramco Company base oil subsidiary Luberef has received approval from Saudi Arabia’s financial regulatory body Capital Market Authority (CMA) for an initial public offering (IPO).

As part of the IPO, Saudi Aramco Base Oil Company (Luberef), formerly Saudi Aramco Lubricating Oil Refining Co, intends to offer 50.045 million of its shares to investors. This is equivalent to approximately 29.66% of Luberef’s share capital.

Luberef is expected to raise nearly $1 billion from the IPO Bloomberg News.

Aramco currently owns 70% of Luberef, which produces base oils used in lubricants for cars, ships and industrial equipment.

Saudi investment bank Jadwa Investment owns the remaining 30% of the oil refining business, which operates in the industrial cities of Jeddah and Yanbu in Saudi Arabia.

In June 2022, Bloomberg reported on this Citigroup, HSBCand SNB Capital have been tapped to advise on the IPO, which could raise about $1 billion.

In a press statement, the CMA said: “The CMA’s approval of the application will be valid for six months from the date of the CMA Board’s decision. The approval shall be deemed revoked if the placement and listing of the Company’s shares is not completed within this period.”

Aramco plans to divest a stake in its oil trading business, Bloomberg News reported, citing people familiar with the matter.

The firm unloaded stakes in units that lease their oil and gas pipelines to undisclosed private investors.

Aramco is also planning an IPO for its energy trading business.

Saudi Aramco reported its second-highest profit as a listed company this month, although its unit responsible for refining, chemicals and fuel distribution posted a pre-tax loss of $1.1 billion, compared with a profit of nearly $4 billion a year earlier. Aramco’s base oils subsidiary has received regulatory approval for an IPO

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