On Thursday, Saudi Arabia announced the transfer of an additional 8% stake in its flagship oil company, Aramco, to entities controlled by the kingdom‘s Public Investment Fund (PIF).
Aramco, central to the Saudi economy, plays a key role in funding Crown Prince Mohammed bin Salman’s extensive Vision 2030 economic and social reforms.
The official Saudi Press Agency relayed Prince Mohammed’s statement on the completion of this share transfer to the PIF-owned companies, highlighting the move as part of Saudi Arabia’s ongoing efforts to enhance and diversify its economy and to broaden its investment landscape.
This latest transaction adjusts the state’s ownership in Aramco to 82.19%, with the PIF and its affiliates now holding a combined 16% of Aramco shares.
This follows previous allocations, including a 4% share transfer to Sanabil Investments, linked to the PIF, and another 4% directly to the PIF in 2022, each contributing significantly to the wealth fund’s portfolio.
Political economist Robert Mogielnicki pointed out the strategic financial advantages of such transfers, such as increased dividend yields, financial strengthening, and expanded asset management.
These moves also reflect a shift under Prince Mohammed’s leadership towards gradually opening up Aramco for external investments, which was highlighted by the 1.7% share IPO in December 2019, raising $29.4 billion.
The PIF, known for its investments in major companies like Uber and Disney, is driving the crown prince’s ambitious giga-projects, including the $500 billion Neom City project, to elevate its assets to $1 trillion by 2025.
