Saudi Aramco taps JPMorgan, M.Stanley for IPO

Posted by Joseph Keefe

Listing of Aramco could raise up to $100
billion.

Oil giant Saudi Aramco has asked JPMorgan Chase & Co and
Morgan Stanley to assist with its upcoming mammoth IPO and could
call on another bank with access to Chinese investors, a source
with direct knowledge of the matter said.

The U.S. banks have joined boutique investment bank Moelis &
Co in being tapped for coveted roles in what is expected to be
the world's biggest intial public offering worth some $100
billion.

HSBC Holdings Plc has emerged as the leading contender for a role
among a list of five banks that could provide a pipeline to
Chinese investors - an important part of the offering, the source
said, adding that the other four are Chinese banks.

The final lineup for banks could still be adjusted, the source
said, declining to be identified due to the sensitivity of the
matter.

The IPO is the centrepiece of the Saudi government's ambitious
plan, known as Vision 2030, to diversify the economy beyond oil.
Up to 5 percent of the world's largest oil producer is likely to
be listed on both the Saudi stock exchange in Riyadh and on one
or more international markets.

Aramco, formally known as Saudi Arabian Oil Co, declined to
comment, as did JPMorgan, Morgan Stanley and HSBC.

The Wall Street Journal reported earlier that JPMorgan, Morgan
Stanley and HSBC had been selected as lead underwriters.

Citigroup Inc was also among those asked to pitch for an advisory
position with Aramco, Saudi-based industry sources said last
month.

The IPO plan has been championed by Deputy Crown Prince Mohammed
bin Salman, who oversees the country's energy and economic
policies. Last year, he said he expected the IPO would value
Aramco at a minimum of $2 trillion, and that the figure might end
up being higher.

Saudi Arabia is considering two options for the shape of Aramco
when it sells shares in the national oil giant next year: either
a global industrial conglomerate or a specialised international
oil company, industry and banking sources have told Reuters.

Saudi Aramco has also appointed international law firm White
& Case, which has a long-established relationship with the
state oil giant, as legal adviser for its IPO, sources familiar
with the matter told Reuters this month.

Saudi Arabia is favoring New York to list Saudi Aramco, while
also considering London and Toronto, the Wall Street Journal
reported on Monday.

The oil giant also held discussions with the Singapore Exchange
regarding a potential secondary listing, sources have said.

Reporting by Mike Stone and Sumeet Chatterjee

Feb 22, 2017

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