Riyadh – Mubasher: The banks which will advise and implement the initial public offering (IPO) of Saudi Aramco are forecast to get a small proportion of the offering's revenues, said informed sources.

Saudi Arabia is at pains to sell around 5% of Aramco in what could be the biggest IPO in history raising up to $100 billion. 

Potential investment banks that will take part in Aramco’s IPO are expected to obtain 0.2% or around $200 million of the money that will be raised, Reuters reported, citing the sources as saying.

The state-owned crude producer is known for having paid low fees for lenders in the past, sources in the banking sector noted.

“Freeman Consulting estimates the pot compares to an average of 2-2.5 percent for IPOs by companies in the region,” Reuters added.

A source in the banking sector indicated that the fees are unlikely to reflect issue’s volume.

“Aramco is known for paying very little fees – for a transaction of this magnitude in the ECM (equity capital market) you are looking at 100 to 150 basis points, but Aramco will pay just 10 basis points,” the source concluded.