Belfast Telegraph

Saudi Aramco transforms into joint-stock company ahead of stock market listing

The Kingdom of Saudi Arabia revealed the process in a cabinet decree published as part of an official bulletin.

Oil giant Saudi Aramco has moved a step nearer to a stock market listing after Saudi Arabia shifted the legal status of the state-owned firm to a joint-stock company.

The change gives the business legal backing to sell shares to outside investors, clearing the way for Aramco to pursue an expected $2 trillion (£1.5 trillion) flotation.

The Kingdom of Saudi Arabia revealed the process in a cabinet decree published as part of an official bulletin.

It comes after the company confirmed in October that the world’s biggest listing was still on track for 2018 and dismissed reports that it may ditch the move.

Aramco has become the subject of a global charm offensive since it began mulling plans to list 5% of its shares.

Prime Minister Theresa May has attempted to place Britain at the front of queue, saying in November that the London Stock Exchange (LSE) had made a very strong case for hosting the initial public offering (IPO).

The comments followed a meeting between Mrs May, former LSE chief Xavier Rolet and Aramco boss Khalid Al-Falih in April, when they pressed home the advantages of bringing the listing to the capital.

The Financial Conduct Authority (FCA) has put forward proposals to allow Aramco to sidestep rules which make firms sell at least 25% of their shares to gain premium status.

Andrew Bailey, chief executive of the FCA, has defended the process to MPs, claiming the requirement for a 25% flotation was “not a hard and fast rule”.

The Government has also issued a $2 billion (£1.5 billion) loan guarantee to Aramco in a bid to boost British exports, but said it was not an attempt to woo the energy giant.

The credit backstop was criticised by ex-Treasury official Nick Macpherson, who tweeted: “HMG guaranteeing a loan to Aramco would be a further lurch in descent to mercantilism. Mr Gladstone will be turning in his grave #stateaid.”

US President Donald Trump launched his own appeal in November, tweeting: “Would very much appreciate Saudi Arabia doing their IPO of Aramco with the New York Stock Exchange. Important to the United States!”.

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