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Aramco markets IPO in Dubai after talks with Kuwait fund

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SAUDI Aramco met investors in Dubai on Sunday to market its initial public offering (IPO), after trying to secure demand from Kuwait's sovereign wealth fund for the deal, worth up to US$25.6 billion, which relies heavily on local and regional buyers.

Dubai

SAUDI Aramco met investors in Dubai on Sunday to market its initial public offering (IPO), after trying to secure demand from Kuwait's sovereign wealth fund for the deal, worth up to US$25.6 billion, which relies heavily on local and regional buyers.

Top executives of the Saudi state-owned oil giant, including Aramco's chief executive Amin Nasser, met officials of Kuwait's sovereign wealth fund weeks ago, a source familiar with the matter said, confirming an earlier report on Sunday in the Kuwaiti newspaper Alrai.

Meanwhile, Aramco's management including its finance head and advisers met institutional investors at an IPO roadshow in Dubai on Sunday, the second outside Riyadh after the company decided to cancel all roadshows in developed markets.

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The Kuwaiti newspaper said the Kuwait Investment Authority's (KIA) decision on whether to participate in the deal would depend on a "study" of the IPO.

Talks have taken place with sovereign investors including the Abu Dhabi Investment Authority, Singapore's GIC and other funds, sources have told Reuters.

Aramco has struggled to attract a major cornerstone or anchor investor for its IPO, which could be potentially the world's biggest.

Some investors asked Aramco about the sustainability of its dividend policy. Aramco has set a base dividend of US$75 billion for five years.

"The only thing left for comfort is the Saudi government, its fiscal policy and ability to sustain the dividends," said a fund manager. "If you're OK with that, you'll invest." REUTERS