RIYADH: Russian and Chinese investors are keen to be involved in the international element of the forthcoming initial public offering of Saudi Aramco, a Russian business leader told Arab News on Monday.
“I would say that some Russian investors are interested,” said Kirill Dmitriev, chief executive of the Russian Direct Investment Fund (RDIF).
“For the sovereign wealth fund (RDIF) to invest in the Aramco IPO is still under discussion. We also have our Russia-China Investment Fund, and we have interest from Chinese investors to get involved in the Aramco IPO. We are still in discussion with our Chinese partners, and with our Russian investors.
“We are thinking what would be the different opportunities, given the interests of China and given the interest of some of the Russian investors. We will have to see how some of the details go, and nothing has been finalized, but there is definitely interest from some Russian and Chinese investors.”
The IPO of Saudi Aramco, the world’s largest oil company, is reaching a critical phase; some observers believe the formal announcement of a listing on the Tadawul, the Saudi stock exchange, is just days away. Having a foreign sovereign investor, as well as a listing on a foreign stock exchange, could be a part of the later strategy to sell about 5 percent of the state-owned company to private investors.
Dmitriev spoke to Arab News in Riyadh at the Saudi Russia CEO Forum, a meeting of top businessmen from both countries to coincide with the visit of President Vladimir Putin. Executives signed a raft of deals as business relations between Saudi Arabia and Russia become increasingly cordial.
“The RDIF jointly with the Public Investment Fund has already invested in 30 different companies, generating very good returns,” Dmitriev said.
“Today we are signing others in sectors ranging from launching satellites from Saudi territory to railroads to joint projects in petrochemicals to our agreement with Salec for investment in agriculture, as well as in aircraft and other areas.”
He said investment between the two countries would increase more than fivefold in the next two years, and congratulated the Saudi government on Vision 2030 and opening the Kingdom to investment.
Among the deals announced at the Forum was an agreement between RDIF and Tania, the Saudi technology development company, to co-operate on a project to establish commercial launch services for small spacecraft, and an agreement to explore ways for Russian and Saudi railway operators to build transport infrastucture.
Russian and Chinese investors also came together with leading Middle East investors to launch a new pharmaceuticals group, Alium.
Dmitriev said investment prospects in the US were becoming increasingly expensive, and that Russia offered the opportunity for Saudi investors to generate annual returns of about 15 percent.