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Heavyweight firms London will be accompanying the City of London’s lord mayor on his trip to Saudi Arabia this coming weekend, as Saudi officials have yet to announce which would be the international stock exchange for the planned listing of 5 percent of oil giant Saudi Aramco.
Charles Bowman, the City of London’s lord mayor, will travel on an overseas business trip to Saudi Arabia and the UAE, scheduled for December 9 - 13.
A senior executive of the London Stock Exchange (LSE) will be part of the business delegation, as well as representatives from PWC, and from investment group Standard Life Aberdeen, The Times reported. The business delegation is expected to hold meetings with officials from the Saudi stock exchange—the domestic market on which Aramco will also list—and from Saudi Arabia’s sovereign wealth funds and monetary authority, according to The Times.
The City of London’s lord mayor has said that Aramco’s IPO would be discussed “without a doubt”, but a source with the City of London told The Times that the listing was not the primary goal of the trip that has been scheduled months ago.
Speaking to City A.M. on Wednesday, representatives of the firms’ part of the business trip said that persuading Aramco to pick London was not on the agenda. Although Aramco is not on the agenda, it “may come up”, PwC told City A.M.
The business trip of London firms to Saudi Arabia will come just a week after UK Prime Minister Theresa May traveled to Riyadh—for the second time this year—to meet with Crown Prince Mohammed bin Salman and with King Salman.
“I think London is extremely well-placed’’ to be picked as the listing venue, May told reporters on the plane, who had asked her how certain she was about London winning the battle for Aramco’s IPO.
New York is also in the running, and last month U.S. President Donald Trump tweeted that “Would very much appreciate Saudi Arabia doing their IPO of Aramco with the New York Stock Exchange.”
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Also last month, the UK was finalizing a $2-billion loan guarantee for Saudi Aramco that the UK Treasury said had nothing to do with the listing. London’s bid to host the IPO has been a curious one since the beginning, because—under current rules—any company wishing to opt for a premium listing needs to list at least 25 percent of its shares. So the UK’s Financial Conduct Authority (FCA) aired the idea of changing the rules for Aramco in July.
In October, the head of the FCA admitted that the watchdog met with executives from Saudi Aramco several months prior to its proposal to change the listing rules for the London Stock Exchange to accommodate the oil giant.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.