What do we know about Aramco’s boutique adviser?

 
Ashley Coates
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A general view shows the Saudi Aramco oi
Source: Getty

The world’s largest IPO in recent times is expected to take place next year, as the Saudi state oil firm known as Saudi Aramco is floated with an anticipated value of around $2 trillion.

New-York based investment bank, Moelis & Co. has been reported as the sole independent adviser on the IPO, representing by far the biggest single advisory mandate for the boutique bank.

Founded in the midst of the credit crisis by Ken Moelis, the firm rapidly emerged as a formidable Wall Street dealmaker and is best known for advising on restructurings, mergers and acquisitions and recapitalisation.

“Do you know how many people told me we were going to go bankrupt? Eve­­ry­­one,” Moelis told the Financial Times recently. “When I was expanding in the crisis the whole street thought I was crazy.”

Formerly president of UBS Investment Bank, Ken’s firm listed on the New York Stock Exchange in 2014, seven years after its founding. Now based on Park Avenue, the bank employs around 655 people.

London is included amongst the 17 cities around the world where Moelis does business, along with Beijing, Frankfurt, Sydney, and Boston.

Other advisory roles taken on by Moelis include the debt restructuring of the Dubai government’s investment vehicle, known as Dubai World, as well as the restructuring of Delphi Automotive.

Recently named no.45 in Bloomberg’s list of the most influential people in the markets, Ken Moelis successfully predicted that Donald Trump would win the US presidency back in September last year. "We haven't elected a president since George H.W. Bush based on competency," he told delegates at Bloomberg’s Most Influential Summit.

The sale of Aramco is part of a broad plan of economic diversification for the government of Saudi Arabia, which is aiming to close its budget deficit by 2020 partly through reducing the country’s dependence on falling oil revenues.

Profits from the IPO are going to be ploughed into investments away from its oil industry, which is still by far its biggest single source of income.

Saudi officials are yet to state which stock exchange will accompany the Riyadh exchange for the listing, but the NYSE is believed to be in the running, along with the Singapore Exchange, for a secondary listing.

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