Some of the biggest banks in the U.S. have obtained roles in Saudi Arabian Oil Co.'s potential acquisition of a majority stake in petrochemicals firm Saudi Basic Industries Corp. from Saudi Arabia's top sovereign wealth fund, Bloomberg News reported.
Goldman Sachs Group Inc. and Bank of America Corp. will advise the Public Investment Fund of Saudi Arabia on the possible deal, two separate sources told Bloomberg, while people with knowledge of the matter told the newswire that Citigroup Inc. will work with SABIC. People familiar with the matter also told Bloomberg that JPMorgan Chase & Co. and Morgan Stanley are advising Saudi Aramco on the potential transaction.
The PIF holds a 70% stake in SABIC, according to S&P Global Market Intelligence data. The wealth fund's stake in SABIC is worth about $70 billion at current market prices, Bloomberg said, making a potential transaction the second-largest M&A deal in 2018, behind Takeda Pharmaceutical Co. Ltd.'s acquisition of Shire PLC. Aramco is reportedly considering up to $70 billion in debt financing to fund the possible acquisition.
JPMorgan, Morgan Stanley and HSBC Holdings PLC were set to join Citi and Goldman as global coordinators on Aramco's IPO before plans for the listing were put on hold, the Sept. 10 report noted, although Saudi Arabia has said it remains committed to floating the state-owned oil giant on the market.