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Saudi Aramco considering two-stage IPO, snubbing London and Hong Kong

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London and Hong Kong might lose out on the world’s largest IPO.

Saudi Aramco is reportedly considering a two-stage IPO between Saudi Arabia and another international exchange, but the massive state-owned oil company could shun Hong Kong and London, according to The Wall Street Journal.

Both financial hubs have been in the running over the last year to host Aramco’s IPO, but the company is leaning away from them due to continued geopolitical uncertainties, The Wall Street Journal reported. The company is now strongly considering Tokyo as the location for the second part of its listing.

Aramco could list up to $50 billion worth of stock on the Saudi Exchange sometime this year, with a follow-on offering on an international exchange in 2020 or 2021, the WSJ reported.

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Companies appear discouraged from pursuing stock listings in London and Hong Kong as a possible no-deal Brexit breeds uncertainty, and as protesters fight a controversial extradition bill.

Most recently, Chinese e-commerce giant Alibaba postponed its multi-billion dollar Hong Kong IPO due to the political turmoil.

Losing the Aramco IPO would be a major hit to London and Hong Kong as they try to compete with the New York Stock Exchange as the premier global financial hub for new public company listings.

Aramco began revisiting a public listing last month, according to the WSJ. The company plans to list 5% of its stock to help Saudi Arabia broaden its economy beyond oil.

Aramco initially planned to raise $100 billion through its public offering, which would make it the world’s largest IPO by a factor of four. For now, Alibaba holds the crown for the world’s largest IPO after its public debut in 2016 raised about $25 billion.

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