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To Lure Aramco Listing, a Slew of Incentives Planned by Singapore Exchange

To Lure Aramco Listing, a Slew of Incentives Planned by Singapore Exchange
As global exchanges compete for a slice of what could be the world’s largest-ever initial public offering, Singapore is considering a range of measures to lure a listing from energy giant Saudi Arabian Oil Co., says the media quoting people familiar with the matter.
In addition to potential Singapore cooperation with the Saudi government on future investments, proposals including inviting one of its state investment companies to become a cornerstone investor in Aramco’s IPO, is being studied by the island nation. Sources reportedly said that to pitch a listing on the bourse, Saudi Arabia was visited late last year by Singapore Exchange Ltd. management including Chief Executive Officer Loh Boon Chye.
The sources also said that a better chance of winning a piece of the listing than a standalone proposal from the stock exchange would be available to Singapore, the biggest oil trading center in Asia, by a full package of government incentives, it hopes. Singapore faces challenges from larger international exchanges and Aramco is yet to make a final decision on the venue for the IPO, sources said.
The IPO is estimated to be about $100 billion in size and the country’s plan shows the extent to which Asian economies are vying for a share of it. Last year sources had said that a potential Hong Kong listing for the company, which could come with anchor investments from Chinese funds, pitching for which has been received by Aramco officials. The possibility of listing in London, New York, Tokyo or Toronto has also been mentioned by company executives.
TMX spokesman Shane Quinn said that as part of efforts by a Canadian consortium that includes major local banks to seek a slice of the IPO, TMX Group Ltd., the owner of the Toronto Stock Exchange, sent officials to Saudi Arabia.
“It’s a Team Canada approach,” he said. “We think with our expertise in the resource sector that this is something we want to pursue. We want to compete for this type of listing.”
Thai Beverage Pcl, the maker of Chang beer backed by billionaire Charoen Sirivadhanabhakdi, had issued the biggest Singapore IPO by a foreign company valued at $980 million in 2006. Data shows that compared with $5.8 billion in Hong Kong and $7.4 billion in London, Singapore’s average daily stock trading was about $761 million last year.
“SGX is the world’s most international exchange and offers unique access to Southeast Asia’s markets,” the bourse operator said in an e-mailed statement, without commenting specifically on a potential Aramco listing. “Singapore is a well-regulated international financial center with strong corporate governance.”
While a representative for Singapore sovereign wealth fund GIC Pte didn’t immediately respond to an e-mail seeking comment from the media, Bottom of Form
a representative for Aramco declined to comment.
Spokesperson for Temasek Holdings Pte, the Singapore state-owned investment company, Stephen Forshaw said that the company “looks at opportunities for investment based on its intrinsic value tests”.  “We do not provide views on our interest or intentions with respect to individual companies.”
Earlier too, big-ticket listings from overseas have been attempted to be attracted by SGX. A 2011 push to win a $1 billion IPO from famed English soccer team Manchester United was led personally by Magnus Bocker, who was then the exchange’s chief executive officer.

Christopher J. Mitchell

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