The successful launch of a US$12b international bond by Saudi Aramco this year renewed momentum for an IPO. Photo / AP
The successful launch of a US$12b international bond by Saudi Aramco this year renewed momentum for an IPO. Photo / AP
Goldman Sachs has clawed its way into contention for a role in Saudi Aramco's planned stock market listing, after a months-long charm offensive by top executives, including former Trump administration official Dina Powell, said several people briefed on the matter.
Powell, who left Goldman in 2017 to work at theWhite House and came back to the Wall Street bank a year later, has leveraged her knowledge of the region and relationships with the kingdom's highest authorities to seek business for Goldman, said one person close to the Saudi state energy giant.
"She's a formidable operator," he said. "She's doing what she did for Trump, for Goldman . . . she is opening doors to win business."
Powell, an Egypt-born Arabic speaker, was instrumental in organising Donald Trump's trip to Saudi Arabia in 2017 — his first foreign visit as president — when she was deputy national security adviser for strategy, sitting in on high-level meetings including those with King Salman and his heir, Crown Prince Mohammed bin Salman.
A person close to Goldman stressed that the strides made by the New York bank in Saudi Arabia were part of a team effort, which included a trip this year by David Solomon, the bank's chief executive, to the kingdom. Other key Goldman bankers involved in courting Saudi Aramco included Akila Raman and Dennis Coleman.
Goldman had failed to secure a top role in the public offering in 2017 when Saudi Aramco nominated banks including JPMorgan Chase, Morgan Stanley, Moelis, Evercore and HSBC to advise them on what could be the world's largest listing.
The initial public offering was postponed following an inability to achieve the US$2 trillion ($3.3t) valuation for the oil group sought by Prince Mohammed, but banks are now preparing their pitches for a flotation.
The successful launch of a US$12 billion international bond by Saudi Aramco this year renewed momentum for the IPO and revived optimism about the Saudi economy after the international condemnation that followed the killing of journalist Jamal Khashoggi.
Former Trump administration official Dina Powell. Photo / AP
Goldman is conducting preparatory work for the Saudi Aramco flotation, ahead of any formal pitching process, said several people familiar with the matter. This follows the bank's role as a bookrunner for the company's bond and its involvement in sovereign issuance.
Saudi officials have maintained that a Saudi Aramco IPO remains a priority for the kingdom. They added that it would take place in 2020 or 2021, after the company had completed the acquisition of a majority stake in Saudi chemicals company Sabic from the Saudi sovereign wealth fund. Goldman advised the Public Investment Fund in the Sabic transaction.
While the kingdom has asked banks to pitch for the IPO — an important marker indicating the flotation is moving ahead — some Saudi officials have privately warned about global economic weakness as a factor that could lead to further delays.
JPMorgan, Saudi Aramco's longtime commercial bank, and Morgan Stanley were both tipped to be global co-ordinators, and even after the IPO was delayed they continued to work for the oil company and on other projects for the kingdom. HSBC has advised on the local component of any stock market listing.
Ken Moelis's eponymous investment bank is still a project manager for the flotation.
Evercore, which had been working alongside Moelis, was taken off the account after a dispute with senior executives at Saudi Aramco, said three people briefed about the matter.
Other banks are now scrambling to secure work on the listing. Some were working for free on specific projects or charging lower fees, said one person familiar with the IPO process.
Financial advisory firm Lazard, which successfully advised on the company's bond, has recently been tasked with assessing Saudi Aramco's debt raising capabilities, said two people close to the Saudi company.
