The Saudi Aramco IPO was supposed to be a cornerstone of Crown Prince Mohammed bin Salman’s ambitious plan to open the gates to foreign investment in the kingdom. But there’s no sign of a stampede.
Most of the active fund managers said they would likely steer clear of the IPO, citing persistent concerns about risks around governance, the environment and regional geopolitics.
All of the passive managers, who track certain indexes rather than making specific investment calls, also said they would not buy shares in the offering. But the bulk of them are likely to routinely become investors when the stock is admitted into the indexes of benchmark providers MSCI, FTSE Russell and S&P, a development due as early as late-December.