China may invest in multibillion dollar Aramco IPO

HONG KONG/RIYADH/ DUBAI — China is creating a consortium, including Stateowned oil giants and banks and its sovereign wealth fund, that will act as a cornerstone investor in the massive multibillion dollar initial public offering of Saudi Aramco, people with knowledge of the discussions said.

Saudi Aramco — a key exporter to China along with Russia’s Rosneft — is due to list next year, with a potential $100 billion equity sale that is expected to be the world’s biggest to date.

The planned Chinese investment makes it more likely that the national energy giant would seek a listing in Asia.

Reuters reported earlier that Saudi Aramco’s board would meet in Shanghai in May, its first meeting in China in seven years, as Chinese and other Asian investors eye the share offering from the world’s biggest oil exporter.

Saudi officials have saidChinese companies were interested in investing in the Aramco IPO as the country seeks to secure crude supplies, but have not commented on how that would be done.

Half a dozen sources with knowledge of the discussions said China Investment Corp, the country’s $800 billion sovereign wealth fund, oil majors Sinopec and PetroChina and the country’s State-run banks were among the State-backed entities set to participate in the Chinese investment consortium.

They did not name the banks. Reuters reported in February that Industrial and Commercial Bank of China International Holdings, a unit of Industrial and Commercial Bank of China, and China International Capital Corp, were among the Chinese banks pitching for a role in the IPO.