UK FCA favors 'sensible' rule changes to attract Aramco IPO

UK's securities regulator,  the Financial Conduct Authority (FCA), is open to "sensible adjustments" on the proposed rules to allow sovereign-controlled companies such Saudi Aramco to list on the London Stock Exchange, Reuters reported.

Public consultation on the proposals for creating a new category of sovereign-controlled firms seeking a listing has been completed, FCA Chief Executive Andrew Bailey told British Parliament’s Treasury Select Committee on Wednesday.

"The focus is on whether 'sensible adjustments' can be made, but no decision has been taken," he added.

The FCA, which regulates the financial services industry in the UK, started last year a process to develop a new listing structure, which would create a separate category of premium listings for companies controlled by sovereign states. The move would facilitate the listing of Aramco shares in London.

The regulator’s plan to change rules, however, had been criticized by a number of investors, with fund manager Royal London calling it “highly inappropriate.”

Saudi Arabia plans to sell a 5 percent stake in the world’s top oil exporter, as it looks to diversify its economy through privatization and fiscal reforms.

The listing is expected to be the world’s largest, valued at $100 billion.

Several international bourses are vying for the IPO, including New York, Hong Kong, Tokyo, and Toronto.