Kuwait’s government will invest as much as $1 billion in the initial public offering (IPO) of Saudi Aramco as the Kingdom asks regional allies to bolster the record share sale, reported Bloomberg.
The Kuwait Investment Authority (KIA) had been reluctant to commit significant funds to the IPO but was told by the government that a stake was in the country’s strategic interest.
Kuwait’s move follows Abu Dhabi, the oil-rich member of the UAE, which has decided to invest $1.5 billion in Saudi Aramco.
Bringing in another major investor from the Gulf region will be a relief for Saudi Arabia after plans to market the IPO globally were abandoned. Saudi Aramco had high hopes of drawing in sovereign investors, including a big purchase from China, but has yet to announce any firm commitments.
The institutional part of the book now has bids totalling SAR 144 billion ($38 billion), covering that part of the proposed sale 2.3 times.
While it has holdings in Kuwait, the KIA is not known to invest in the region. The fund has interests in ports, airports and power distribution globally.