• 3 minutes This Battery Uses Up CO2 to Create Energy
  • 5 minutes Shale Oil Fiasco
  • 9 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 12 minutes Historian Slams Greta. I Don't See Her in Beijing or Delhi.
  • 8 hours Boris Johnson taken decision about 5G Huawei ban by delay (fait accompli method)
  • 14 hours Governments that wasted massive windfalls
  • 12 hours Let’s take a Historical walk around the Rig
  • 14 hours We're freezing! Isn't it great? The carbon tax must be working!
  • 1 day Trump has changed into a World Leader
  • 14 hours Here is Why People Lose Money Trading Natural Gas
  • 1 day Beijing Must Face Reality That Taiwan is Independent
  • 39 mins Tesla Will ‘Disappear’ Or ‘Lose 80%’ Of Its Value
  • 12 hours US Shale: Technology
  • 16 hours 2nd Annual Great Oil Price Prediction Challenge of 2019
  • 22 hours Trump capitulated
  • 2 days Yesterday POLEXIT started (Poles do not want to leave EU, but Poland made the decisive step towards becoming dictatorship, in breach of accession treaty)

UK’s FCA Met With Aramco Prior To Proposing Listing Rule Change

London

The UK’s Financial Conduct Authority’s chief 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.

In a letter to legislators, Andrew Bailey said that representatives of the regulator “held conversations with Saudi Aramco and their advisors in light of their interest in a possible UK listing in the early part of this year”. The FCA head also said in the letter that “We emphasised during those conversations that we were reviewing the listing regime.”

FCA’s listing rules currently require that any company wishing to opt for a premium listing needs to list at least 25 percent of its shares. Aramco, however, plans to only float 5 percent of its stock – a much-anticipated event planned for the second half of 2018.

The FCA announced the idea of changing the rules for Aramco in July. FCA’s proposal essentially comes down to creating a new category within its rules for premium listings, “to cater for companies controlled by a shareholder that is a sovereign country.” The aim was to convince Aramco to go for the premium, rather than the standard, listing.

The Telegraph recalls that the proposal came soon after PM Theresa May and LSE’s chief executive Xavier Rolet traveled to Riyadh to discuss bilateral trade opportunities. The visit included a meeting of May and Rolet with Aramco’s head, Energy Minister Khalid al-Falih.

The proposal quickly drew criticism from corporate governance bodies, including the Institute of Directors, which last month came out with a press release saying the market watchdog’s proposal did “little to address the risks and challenges surrounding sovereign-controlled companies which include the potential for politically-motivated ownership interference over the company by the state apparatus. National governments are also in a strong position to undermine the rights of minority shareholders and the authority of the Board of Directors at such enterprises.”

Related: The New Challenger To Lithium Batteries

Last month, the chairs of two UK parliament committees approached the Financial Services Authority over a proposal to relax LSE listing rules in a bid to win the business of Saudi Arabia when it floats Aramco next year.

Nicky Morgan, chair of the Treasury Select Committee, and Rachel Reeves, head of the Energy and Industrial Strategy Committee, wrote to the watchdog with a number of questions regarding whether FCA’s proposal for a consultation to look into a change of listing rules was in any way motivated by interest expressed by Aramco’s management in floating 5 percent on the London Stock Exchange.

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
Download on the App Store Get it on Google Play