May visits Riyadh to promote ties with Saudi Arabia
London - London is now one of the front runners to host Aramco’s initial public offering (IPO) after a visit by British Prime Minister Theresa May to Riyadh.
May met with Saudi Aramco officials and proposed floating the world’s most valuable company on the London Stock Exchange (LSE). May, whose delegation included LSE Chairman Xavier Rolet, met Saudi Energy Minister Khalid al-Falih, who is also Aramco’s chairman, to highlight the benefits of using London for what is being described as the biggest IPO in history.
A statement from Downing Street said May and Falih “discussed working together on energy policy, including energy diversification, as well as investment opportunities for small and medium businesses on the LSE and in the UK”.
The statement said the British prime minister pointed out “the advantages of listing in London” and the “depth of expertise” the United Kingdom’s financial services could provide.
Several prominent global stock exchanges are vying for the Aramco IPO. These include Tokyo, Singapore, Hong Kong, Toronto and New York, which is perceived, along with London, as the front runner.
May’s visit to Riyadh comes at a time of economic uncertainty in the United Kingdom, tied to the recently activated Article 50, which will see the country leave the European Union. Aramco’s listing of its shares in the United Kingdom would offset some of that uncertainty, reaffirming London’s position as a global financial hub.
The Aramco flotation is a part of the Saudis’ Vision 2030 economic and social reform plan, which is designed to wean the kingdom from dependency on its energy sector. Aramco, estimated to be worth as much as $2 trillion, is planning to sell 5% of its shares.
Saudi Arabia is Britain’s largest trading partner in the Middle East, with British exports to the country estimated at $8.1 billion in 2015.
Saudi King Salman bin Abdulaziz Al Saud hosted May at Riyadh’s Yamama Palace. A Downing Street spokesman said the two leaders discussed a wide range of subjects, including security and strengthening of ties, with May emphasising that security relationships between the countries had saved many lives in the United Kingdom. They also discussed ways of addressing the humanitarian situation in Yemen.
Among the issues also discussed was the possibility of biannual strategic talks to fortify security, defence and intelligence cooperation. The United Kingdom will work with the Saudi Ministry of Defence to help it review its defence capabilities, as well as coordinate with other parts of the Saudi armed forces.
Additionally, in line with Saudi attempts to diversify its economy, a seminar led by British experts on tax and privatisation is to be organised.
After their meeting, King Salman awarded May the Order of King Abdulaziz, one of the kingdom’s highest honours.
May also met with Saudi Crown Prince Mohammed bin Nayef bin Abdulaziz for talks centring on security matters, including the war on terror, efforts to curb online radicalisation and the threat posed by foreign fighters returning from Syria.
May upset officials in Iran with remarks in an interview with Alriyadh newspaper, saying that the United Kingdom had “no illusions about Iran’s destabilising activities in the region”.
“We will continue our support for the Gulf states against Iranian interference in their internal affairs,” May said, adding that Tehran was working against the interests of international efforts towards peace and stability.
Iranian Foreign Ministry spokesman Bahram Qassemi called May’s statement that his country was destabilising the region “untrue and baseless”.
While in Riyadh, May also met Princess Reema bint Bandar, who is the head of the women’s section at the Saudis’ General Authority for Sports. The two visited Riyadh’s Leadership Institute, where they spoke with schoolgirls playing basketball.