Saudi Arabian oil giant Aramco has held talks with the Singapore Exchange (SGX) over a secondary listing at the Asian bourse, Reuters reported. There were reports earlier that Singapore was trying to attract Saudi Arabian Oil Co. to list locally.
The report citing people close to the matter said Aramco was considering several markets including New York, London, Hong Kong and Japan as it works on what would be the world's largest ever Initial Public Offering (IPO) next year.
"This transaction is very open and in the public space. The key thing is there is quite a bit of time for due diligence and SGX is keen to play up its international appeal in this sector," a source told Reuters.
Meanwhile, Bloomberg reported that Singapore Exchange's Chief Executive Officer, Loh Boon Chye, had travelled to Saudi Arabia late last year to boost the prospects of the oil company listing in the Asian oil hub. The report said Singapore was mulling options including a state wealth fund becoming a cornerstone investor in Aramco IPO.
The secondary listing is the issue of new stock at a different bourse by a company that has already made its initial public offering. Investopedia says usually this kind of public offerings are made by companies wishing to refinance, or raise capital for growth.
The Saudi Arabian oil giant is planning to put up for sale only around 5 percent of its shares, but the IPO will be worth a record S$100 billion. Aramco has the capacity to produce more than 10 million barrels per day of crude, double that of closest competitor Rosneft.
As part of the preparations for the share listing, Aramco, whose estimated worth is around US$2 trillion, said it has more than 261 billion barrels of reserves according to an external audit.
Oil Price reported that ahead of the planned IPO, Aramco is in the market for raising $10 billion in its first bond sale.
Saudi Aramco mooted the share sale after the deputy crown prince, Mohammed bin Salman, unveiled a new economic strategy last year that sought to diversify the oil-reliant economy and cope with the continued slump in crude prices.
An SGX statement said it is the world's most international exchange that offers unique access to Southeast Asia's markets. Singapore is strategically placed in the oil trading route and boasts of the presence of a vast majority of the world's top oil companies.