Saudi PIF's Assets Swell To $940B After Aramco Stake Transfer

The Public Investment Fund, Saudi Arabia's sovereign wealth fund, has seen the total value of its assets spike 21% to $940.3 billion, the Sovereign Wealth Fund Institute (SWFI) reported in its latest update, after the kingdom transferred a stake in state-run energy and chemicals giant Aramco to the fund last week.

Asset boost

Saudi Arabia restructured its holdings by transferring an 8% stake in Aramco to the PIF to boost the fund's financial resources and potentially prepare for a future initial public offering (IPO) of Aramco shares.

Based on Aramco's current market capitalization, the transferred stake is estimated to be worth around $163.6 billion, according to data from LSEG.

The transfer made the fund climb one rank to become the fifth-largest globally.

The PIF directly owned 4% of Aramco shares since 2022, while indirectly controlling another 4% stake that was transferred to Sanabil, a company it wholly owns, last year.

The Saudi government has significantly increased funding for the PIF through cash transfers, including a $40 billion injection in 2020, as part of the country's economic diversification efforts to reduce dependence on income from oil sales.

Following the transfer, Saudi Arabia's state ownership of Aramco remains at 82.186%, according to a statement from Aramco.

SWF rankings

The world's top sovereign wealth funds are the Norway Government Pension Fund Global, with approximately $1.65 trillion in assets; the China Investment Corporation, with $1.35 trillion; SAFE Investment Company at $1.09 trillion; and the Abu Dhabi Investment Authority, with $993 billion.

PIF's debt

The PIF has issued debt twice this year, raising $7 billion, mainly due to favorable market conditions for emerging market borrowers.

According to a recent report by Global SWF, PIF's total debt is estimated to be around $36 billion, with the potential of continued borrowing in the future.

PIF Governor Yasir al-Rumayyan signaled that the fund intends to boost its annual capital investment and raise deployments from the current range of $40 billion to $50 billion per year and $70 billion annually after 2025.

The Saudi fund was the world's leading sovereign wealth fund in terms of spending in 2023, having invested $31.5 billion.

Big number

$2 trillion. That's the value of assets under management the PIF aims to achieve by 2030.