Saudi Aramco may be worth far less than official valuation

On Monday the Wall Street Journal reported that Saudi ARAMCO may be worth far less than its official valuation. It cited people who are familiar with the company’s plan to go public.

 

These sources revealed that officials working on Aramco’s offering have not been able to draft a model matching the figure quoted by Saudi’s deputy crown prince, Mohammed bin Salman.

Even accounting for a more favorable tax rate, the highest valuation that employees were able to come up with was about $1.5 trillion, the Journal said, citing internal documents it reviewed and people familiar with the matter.

If correct, that would mean the initial $2 trillion valuation figure is off by a little more than the combined market valuation of Amazon and Netflix. Alternatively, the $500 billion discrepancy is a little less than the market capitalization of Microsoft.

Saudi Aramco did not immediately respond to a request for comment. (Source credit – CNBC)

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