Could the recent upheavals in the United States, played out largely on the political stage, serve as a deterrent to Saudi business intentions to list on local stock exchanges?
The Wall Street Journal reported that that the Saudis’ multibillion-dollar U.S. investment strategy must be re-evaluated after two seismic events occurred, as legislation has been passed that lets terror victims sue the country, and Donald J. Trump, who, of course, is ascending to the presidency, signaled his own support of that legislation.
One casualty may be the initial public offering, expected to debut next year, of Aramco, its state-owned oil company, a listing that could fetch at least $100 billion. The WSJ noted that that listing could be moved to another country and to another exchange. In fact, said the WSJ, citing an unnamed source, the country’s sovereign wealth fund has paused investments in the United States until there’s more clarity on the legislation and from the new White House administration. The key for the Saudis is to invest abroad, with an eye on non-energy assets. In one transaction, the fund invested $3.5 billion into Uber. And in a move the WSJ said may have been a response to the bill passed, the Saudis said they would invest as much as $45 billion in a fund managed by Japanese internet and telecom firm SoftBank. But at least some of that money would flow, ultimately, into the U.S., as SoftBank executives said they would invest $50 billion in the U.S., with 50,000 new jobs created here as a result.
The legislation would let victims of the Septwmber 11, 2001, terrorist attacks sue Saudi Arabia, and should they be found liable, then assets could be at stake in judgements. Congressional leaders have yet to amend, soften or change tenets of that legislation and may, in fact, leave it as it stands, where it has drawn support from Trump.