• 8 minutes U.S. Shale Oil Debt: Deep the Denial
  • 13 minutes WTI @ $75.75, headed for $64 - 67
  • 16 minutes Trump vs. MbS
  • 37 mins Despite pressure about Khashoggi's Murder: Saudi Arabia Reassures On Oil Supply, Says Will Meet Demand
  • 17 hours Nuclear Pact/Cold War: Moscow Wants U.S. To Explain Planned Exit From Arms Treaty
  • 10 hours Knoema: Crude Oil Price Forecast: 2018, 2019 and Long Term to 2030
  • 5 hours Merkel Aims To Ward Off Diesel Car Ban In Germany
  • 59 mins Why I Think Natural Gas is the Logical Future of Energy
  • 17 hours A $2 Trillion Saudi Aramco IPO Keeps Getting Less Realistic
  • 14 hours Iraq war and Possible Lies
  • 4 mins Satellite Moons to Replace Streetlamps?!
  • 10 hours Get on Those Bicycles to Save the World
  • 1 day Can the World Survive without Saudi Oil?
  • 1 day Long-Awaited Slowdown in China Exports Still Isn’t Happening
  • 12 mins Aramco to Become Major Player in LNG?
  • 11 hours EU to Splash Billions on Battery Factories
Lithium Is Yesterday’s News – Vanadium Is The Future

Lithium Is Yesterday’s News – Vanadium Is The Future

Scalable sustainable energy storage has…

Saudi Arabia Shuns UBS, BofA As Aramco IPO Coordinators

oil storage

Saudi Arabia has excluded Swiss UBS, Bank of America Merrill Lynch, and Barclays from the select group of investment banks invited to pitch for the role of coordinators in the initial public offering of Aramco, five sources told Reuters.

Riyadh, the sources explained, is distrustful of lenders that have not extended loans to it in the last few years, as local corporate culture requires, which is why BofA and UBS have been excluded. As for the reasons for Barclays’ exclusion, the sources were not clear.

Yet not all is lost for the three lenders; they could still get more minor roles in the listing as junior advisers or bookrunners. Thomson Reuters data reveals that BofA has not lent any money to Aramco since 2010 based on the lack of reports about loan fees, which for the period between 2002 and 2010 totaled just US$180,000. UBS has no records of any loan fees from Aramco over the 15-year period that Thomson Reuters reviewed.

Those that made the cut, meanwhile, include Goldman Sachs and Deutsche Bank. If they are approved, they will join Citigroup, JPMorgan, and HSBC. JPMorgan is the leader among Aramco lenders, with US$9.5 million from loan fees from the Saudi company since 2002. Citi and HSBC were third and sixth, respectively. Deutsche is in the top 20 lenders to the company and Goldman ranks 34.

Related: Is An Oil Price Spike Inevitable?

Earlier this month, Reuters reported that Aramco was seeking to obtain up to US$6 billion in cheaper loans before the share sale in a sign that it is trying to ensure that its highly anticipated IPO will take place this year, taking advantage of banks that are willing to boost ties with the Saudi oil giant and position themselves for roles in the IPO.

According to two sources, Aramco could raise at least US$5 billion, backed by export credit agencies, in transactions on which Citigroup, Standard Chartered, and Sumitomo Mitsui Banking Corporation are advising. Aramco wants to obtain loans on which it would later pay lower interests because it still is a wholly state-owned firm that can benefit from cheaper loans for sovereign borrowers

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News