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JP Morgan close to securing a leading role in the biggest IPO in history: Saudi Aramco
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Loading...Somewhere, Jamie Dimon is smiling.
J.P. Morgan Chase is close to winning a leading advisory role in Saudi Aramco's initial public offering, the world's most profitable corporation creating rivals for the important role. The final decision is expected to be taken this week, but may still change in the future.
Morgan Stanley, who are fighting JP Morgan for the deal, were hurt by their role in the Uber IPO.
Saudi representatives, who own large Uber through the country's sovereign wealth fund, were dissatisfied with Morgan after its bankers misjudged demand for the transportation giant's shares in May. Shares fell 18% in the first two trading days and are still well below the $ 45 IPO.
The move spans years of efforts by global investment banks to force Saudi Arabia into lucrative deals. The state-owned Saudi Aramco IPO, the world's largest oil company, is the government's main source of revenue and is at the heart of Crown Prince Mohammad bin Salman's plan to diversify the country from fossil fuels.
With the title of lead advisor comes bragging rights in the top circles of investment banking. Not only is JP Morgan on track to receive the largest share of fees from the upcoming IPO, but if it can manage it smoothly, it will be well positioned for future roles by the company.
As a leading advisor, JP Morgan's bankers are familiar with the most important discussions involving major IPO decisions and will coordinate other investment banks in the transaction as they distribute shares to their respective institutional clients.
Until recently, JP Morgan was also seen as a laggard behind Morgan Stanley and Goldman Sachs when it came to big IPOs. So the news should be especially sweet for Jamie Dimon, JP's longtime CEO. Saudi Aramco brought in more than $ 111.1 billion in profits last year, almost double what Apple's tech giant did.
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