London is creating a new type of listing to try and get $2 trillion Saudi Aramco to IPO in Britain

pulse

May 16, 2017 8:32 AM

Saudi Aramco's plan is to see 5% of the company listed publicly in an IPO worth between $50 billion and $100 billion.

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LONDON — The London Stock Exchange is reportedly working to create a new listing structure as a means of making the capital a more attractive location for Saudi Aramco's mammoth IPO.

According to a report from Reuters on Wednesday evening, Britain's biggest stock exchange is planning to create a structure that would allow the state-owned oil giant to have the equivalent to a primary listing on the exchange, without being subject to "

Saudi Arabia is due to list shares in the company, valued by officials at around $2 trillion, in both Riyadh and at least one other foreign stock exchange by 2018.

London is vying with other financial centres such as New York, Hong Kong, Toronto and Singapore to play host to the float. Saudi Arabia appointed JPMorgan, HSBC and Morgan Stanley to manage and advise on the deal.

The valuation of the shares has been the subject of intense debate because the company is yet to disclose financial details such as sales or profits.

which is around two-thirds the size of the entire London Stock Exchange.

But, according to FT estimates using valuations from previous shares sales of British Petroleum and Brazil's Petrobras, the correct valuation should be no more than $1.1 trillion.

You can read Reuters' full report here.

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