Malaysia's Petronas: We will not participate in Saudi Aramco's IPO

KUALA LUMPUR (Reuters) - Malaysia's state energy firm Petronas told Reuters on Friday it would not take part in Saudi Aramco's initial public offering, which is expected to be the world's largest sale of shares.

Aramco plans to sell 1.5% of the company in the offering and is looking to raise up to $ 25.6 billion and give the company a potential market value of $ 1.6 to $ 1.7 trillion.

Earlier this month, Petronas said Aramco had contacted it to participate in the listing of the Saudi giant.

The company said in an emailed statement that it "wishes to confirm that after due consideration it decided not to participate in the implementation of the IPO of Saudi Aramco."

Petronas and Aramco have a joint venture for a $ 27 billion refining and petrochemical complex in southern Malaysia that is due to start commercial operations this year.

Aramco launched the sale on November 3 after a series of failures.

The deal is crucial to Saudi Crown Prince Mohammed bin Salman's plans to raise billions of dollars to invest in non-oil industries, create jobs and diversify the economy of the world's largest oil exporter away from reliance on crude.

To date, no major government company or fund has announced participation in Aramco's offering.

Saudi Aramco said on Thursday that Aramco's initial public offering had attracted 73 billion riyals ($ 19.47 billion) underwriting from institutions and individuals so far.

Institutional subscriptions amounted to 58.4 billion riyals for 1.82 billion shares.

Warnings
Meanwhile, a report by Paris-based consultancy Calinder warned of the long-term effects of climate change on Saudi Aramco's activity, with rising sea levels and rising temperatures, threatening a number of infrastructure projects and productivity. The case led to the suspension of some of its projects.

The southern part of Yanbu could be inundated in the next 10 years, Bloomberg quoted Kalinder CEO Tibolet Lacond as saying.

"Aramco is aware of the implications of climate change but its position is ambiguous. Is there something that people (at the company) lack?

Bloomberg considered the report raises further doubts about the initial public offering of the Saudi state-owned company.

In the IPO, Aramco acknowledged that fear of climate change could lead to a decline in global demand for traditional carbon energy sources and products, while increasing the likelihood of suing the giant and its subsidiaries.