Saudi Aramco will receive $2 billion in credit guarantees from the British government to buy goods and services from the UK more easily, agencies reported on Thursday, citing a UK Treasury spokesperson.
“We will be providing Saudi Aramco with support in the form of credit guarantees to procure from the UK. This builds on previous support for UK exports as part of Saudi Aramco joint venture projects,” the spokesperson said.
The facility is being finalized by UK Export Finance, a ministerial department working to boost British exports by providing finance to foreign buyers of the country’s goods and services.
The Treasury, however, denied that the agreement was to encourage Aramco to choose London as the international venue for its $100 billion initial public offering (IPO) next year.
“It’s completely separate to that,” an official said, cited by the Financial Times.
London is among several global bourses vying for the lucrative listing, widely expected to the world’s largest ever. Other exchanges in the running include New York, Toronto, Hong Kong, Singapore, and Tokyo.
The UK’s Financial Conduct Authority (FCA) has previously proposed a new listing structure that would offer sovereign-controlled entities like Aramco their own ‘premium listing’ category, which would exempt them from requirements like how much of the company has to be floated.
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