Aramco Looks For JPM, MS Assistance

Saudi Aramco looks to JPMorgan (NYSE:JPM) and Morgan Stanley (NYSE:MS) for financial assistance while tapping HSBC (NYSE:HSEB) for Legal assistance along with its Asian market influence.

Oil giant Saudi Aramco has been working on a possible partnership with JPMorgan Chase & Co (NYSE:JPM) and Morgan Stanley. The two banks will be looking to assist the oil company’s gigantic initial public share offer and Aramco is still looking to add another bank to handle its Chinese investors.

The role is very much fought for and has been eluding a lot of banks to assist Aramco. The specifics of the role is that JP Morgan and Morgan Stanley would be helping Saudi Aramco’s planned initial public offering, and since Saudi officials have been valuing the company at $2 trillion and the expected IPO is most likely to raise $100 billion from investors. At this rate, Saudi Aramco is on the track to overtake apple as the world’s most valuable listed company.

Saudi Aramco’s IPO

The Saudi government has been long planning, ambitious, and an ambiguous plan called Vision 2030. The IPO would be the grandiose centerpiece to diversify the economy; breaking the walls of the what one oil classed economy, to a freer and expandable one. There are also estimated 50 or more percent of the world’s largest oil producer to be listed on both the Saudi stock exchange in Riyadh and on one or more international market.

The deputy crown prince of Saudi Arabia Mohammed bin Salman on an interview last year said that the company has been considering investing proceeds from the IPO in non-oil industries. Saudi Aramco who was once called Saudi Arabian Oil Co. has been dodging every interview with the recent negotiations, JP Morgan and Morgan Stanley declined to comment as well.

White & Case, Aramco Relationship

The international law firm based in New York was also tapped by the Saudi Arabia to be their legal advisor for its IPO. White & Chase has been known to have a long-established relationship with the state oil giant. Saudi Arabia is also pondering on the options for the shape of Aramco when it sells shares in the national oil giant next year, it will be either global industrial conglomerate or specialized international oil company.

JP Morgan, Morgan Stanley Roles

JP Morgan has been the longstanding commercial banker for Saudi Aramco’s; they would be holding the position as a global coordinator and book runner for the planned sale of the 5% stake in the state-controlled company in 2018.

While Morgan Stanley will also be joining JP Morgan as coordinator and book runner on the listing, on the other hand, HSBC is also a potential candidate for an underwriting role in the Saudi Aramco listing.
The reason behind is HSBC has the potential to tap on Asian investors due to its origin in Hong Kong, and its well reputable presence in the middle east.

Today, the Saudi Arabia is strongly looking to look for New York to list Saudi Aramco, while the country is still weighing between London and Toronto. While Aramco has been holding discussions with the Singapore exchange for the purpose of a potential secondary listing, sources have reported.