Aramco snubs UBS, BofA-ML for listing roles
Saudi Aramco has not invited UBS and Bank of America Merrill Lynch to pitch for senior advisory roles in its stock market listing because they have not lent money to the state oil giant in recent years, according to five finance sources.
The two investment banks, among the world’s biggest, have not been asked to attend meetings in Saudi Arabia in the coming weeks where its rivals will pitch for global coordinator mandates for the IPO, said the people familiar with the matter.
They have been frozen out by Aramco, the sources added, despite having operations in the Middle East and wanting to take part in the initial public offering, which could be the biggest in history.
Saudi Aramco, Bank of America Merrill Lynch and Swiss lender UBS all declined to comment. The sources said the exclusion of the banks reflected a corporate culture in the region of tying advisory mandates to how much of its own money a lender is willing to commit.
Aramco will need to borrow significant sums from Western banks in years to come to keep up with its investment pledges. Among its plans, it aims to invest $300 billion in oil and gas production in the next decade and expand its refining and petrochemical capacity around the world.
Barclays has also not been invited to pitch, according to two separate banking sources Barclays declined to comment.