Saudi Aramco recruits JPMorgan, Morgan Stanley for IPO, HSBC a contender: source
By Mike Stone, Tom Arnold and Sumeet Chatterjee
(Reuters) - Oil giant Saudi Aramco [IPO-ARMO.SE] has asked JPMorgan Chase & Co and Morgan Stanley to assist with its mammoth initial public share offer and could call on another bank with access to Chinese investors, a source with direct knowledge of the matter said.
The U.S. banks have joined boutique investment bank Moelis & Co in winning coveted roles in what is expected to be the world's biggest IPO, worth some $100 billion.
HSBC Holdings Plc has emerged as the leading contender for a role among a list of five banks that could provide a pipeline to Chinese investors - an important part of the offering, the source said, adding that the other four are Chinese banks.
Industrial and Commercial Bank of China International Holdings, a wholly-owned Hong Kong-based subsidiary of Industrial and Commercial Bank of China , and China International Capital Corporation (CICC) are among the Chinese banks pitching for the deal, two other sources familiar with the matter said.
"This will give Chinese banks a bit of an opportunity to flex their muscles and show that they have the firepower to get involved in such a large, global deal,” said Benjamin Quinlan, CEO of financial services consultancy Quinlan & Associates.
"There will also be a strategic interest from the government side to have some China role in the IPO process given the role Saudi Aramco plays in the resources sector there. So, there is a political undertone to it as well."
The growing Chinese interest in Aramco's IPO comes ahead of King Salman's visit to Asia next week.
The final line-up for banks working on the IPO could still be adjusted, the first source said. Continued...