City watchdog seeks to reassure big investors on Saudi Aramco float ahead of crown prince's UK visit

Jasper Jolly
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Crown prince Mohammed bin Salman is behind the plans to list Saudi Aramco (Source: Getty)

The City watchdog is seeking to mollify institutional investors who have expressed serious concerns over plans to make it easier for the oil major Saudi Aramco to list in the UK ahead of a visit to the capital by Middle East nation’s powerful crown prince.

The Financial Conduct Authority (FCA) last month met bosses from the Investment Association (IA) to explore issues around controversial listing plans which would ease the path for the Aramco listing, Sky News first reported.

The lobby group, which represents the managers of trillions of pounds of assets such as Blackrock and Legal and General, has previously objected to the plans to create a new “premium listing” category which would allow Aramco to list with lower transparency requirements.

Read more: Why the international scramble for the Aramco IPO might prove futile

The FCA reportedly discussed the possible abandonment of a proposal to allow Aramco to list only five per cent of its shares, below the usual 25 per cent requirement.

A person with knowledge of the meeting said it was “useful”, adding: “It was really good to see the FCA are willing to engage with asset managers.”

Saudi Arabia’s crown prince, Mohammed bin Salman (known as MbS), will tomorrow visit the UK for the first time since assuming his role in June 2017. The prince has since tightened his grip on power through an anti-corruption drive which has seen members of the royal family detained.

Read more: London on Saudi Aramco listing shortlist along with Hong Kong and New York

The plans to list Aramco are likely to feature high up the agenda when MbS meets Theresa May in 10 Downing Street, after a period of heavy lobbying which saw the Prime Minister, accompanied by London Stock Exchange bosses, go to Saudi Arabia herself.

In a statement ahead of the meeting, May said talks will cover “substantial opportunities for British companies in Saudi Arabia” as well as security and humanitarian issues around the brutal civil war in Yemen.

The Foreign Office last night said the visit will “usher in a new era in our bilateral relations with one of our oldest friends in the region”.

Read more: The government is offering Saudi Aramco a $2bn loan guarantee

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