DUBAI, April 10 Saudi Aramco's board will meet
in China in May for the first time in seven years, industry
sources said, as the state-owned energy firm seeks to lure
Chinese and Asian investors to its giant share offering.
The board of directors would gather in Shanghai on May 10 to
discuss the firm's business plans, investments and preparations
to sell up to 5 percent of Aramco in 2018, the sources said.
An annual report of the company's activities for the
previous year is usually issued after the board meeting.
The board, which gathers twice a year, often meets abroad
but only once before had a meeting in China, in 2010.
Aramco has appointed international banks with access to
Chinese investors to advise on the initial public offering (IPO)
The issue of Aramco's IPO and a potential role for Chinese
investors was discussed last month during the visit by Saudi
Arabia's King Salman to Beijing, sources said.
The IPO could generate up to $100 billion and give Aramco an
overall valuation of $2 trillion, the biggest ever.
"Chinese participation in Aramco's IPO would be very logical
and strategic," said Sadad al-Husseini an energy analyst and
former Aramco executive.
Saudi officials have said Chinese companies were interested
in investing in the Aramco IPO as Beijing seeks to secure crude
supplies from the world’s biggest oil exporter.
"There is a serious push from Aramco for Chinese investors
to become cornerstone investors in the IPO," an industry source
A second source said talks were at an early stage and any
Chinese investment in Aramco would likely be in coordination
with the Beijing government.
Aramco is likely to be listed on the Saudi stock exchange in
Riyadh and on one or more international markets. The kingdom is
considering exchanges in New York, London, Toronto and Asia.
Industrial and Commercial Bank of China International
Holdings, a unit of Industrial and Commercial Bank of China
, and China International Capital Corporation (CICC)
are among Chinese banks pitching for a role in the IPO, sources
familiar with the matter have told Reuters.
Chinese participation in the IPO could strengthen Riyadh's
hand in other Chinese investment decisions, the sources said.
Aramco has been in talks for years to invest in refineries
in China so it can sell more of its crude to China. Those plans
have yet to progress.
The board, which often tours Aramco's investments where they
meet, also comes before the Organization of the Petroleum
Exporting Countries gathers in Vienna on May 25 to decide on
output policy. An OPEC-led pact to cut supplies ends in June.
The nine-member board includes Saudi Energy Minister and
Aramco Chairman Khalid al-Falih, Minister of State Ibrahim
al-Assaf, Aramco CEO Amin Nasser, Public Investment Fund
Managing Director Yasir al-Rumayyan and royal court adviser
Majid al-Moneef. It also includes former Royal Dutch Shell
Chairman Mark Moody-Stuart and former Schlumberger head Andrew
(Reporting by Reem Shamseddine in Khobar, Rania El Gamal in
Dubai and Aizhu Chen in Beijing; Editing by Dmitry Zhdannikov
and Edmund Blair)