State oil giant Saudi Aramco is reportedly seeking a $2bn loan from Japan’s export credit agency.
Sources told Bloomberg Japan Bank for International Cooperation had yet to reach a final agreement for the loan.
Should a deal take place, the Japanese credit agency would be the second state institution to extend financing to Aramco ahead of its planned listing.
The sources said Japanese lenders were competing with each other to arrange the loan as a way of getting closer to Aramco and winning a role in its IPO.
The UK government previously agreed a $2bn loan guarantee for Aramco in November to finance the purchase of British goods.
However, the size of the loan led to suggestions the UK was trying to lure Aramco’s listing away from the US, which is also competing to host the offering alongside Japan and other stock markets.
Aramco previously signed an agreement with a group of regional and international banks for $10bn of standby revolving credit facilities, according to the report.
The loan talks come as mandates on the 5 per cent IPO, which could value Aramco at $2 trillion, are finalised with banks.
Goldman Sachs, Citigroup, JPMorgan, HSBC and Morgan Stanley are said to be among the lenders seeking a place on the deal.
Most of the proceeds from the listing are expected to go directly to Saudi sovereign wealth fund the Public Investment Fund.
Seperately, Reuters reported on Tuesday that Abu Dhabi National Oil Company planned to raise a $3bn syndicated loan with the participation of Japan’s export credit agency.
Sources told the news wire ADNOC had chosen HSBC, Mizuho and Sumitomo Mitsui Banking Corp to arrange the planned debt facility, which is expected to have a five-year maturity.