Will retail investment in publicly traded water equities in the Middle East ever be a
serious part of the industry? It’s a question that bears some thought, and the issue
couldn’t be more timely, as Saudi investors grapple with the prospect of Aramco’s
$1.7 trillion IPO.
This colossal sum is $300 billion shy of the valuation for Aramco that crown prince
Mohammed Bin Salman was believed to be aiming for, and the 1.5% stake being
put up for sale is significantly smaller than originally planned. The lower-thanexpected
valuation means that plans to market the IPO abroad have largely been
dropped and initial roadshows are now restricted to GCC countries. This is not to
say that investors in the region will be short-changed. But the whole process seems
to have fallen into a familiar trap for IPOs in the region – where there is a choice
between maximizing interest among retail investors with an open and competitive
bookrunning process, and meeting national targets that may be at odds with the
retail market as a whole.
