Saudi Arabia’s Tadawul Looks To Raise $1 Billion In Its First Public Offering

Saudi Tadawul Group, the owner and operator of the kingdom’s stock exchange, aims to raise up to 3.78 billion Saudi riyals ($1 billion) from its initial public offering.

The holding company has set the price range of its IPO between 95 riyals and 105 riyals per share, it said in a statement on Sunday. pronunciation to the Saudi stock exchange.

The company is selling 36 million shares, or 30 percent, of its 120 million issued share capital to the public. The bidding and bookbuilding period for investors starts on November 21 and ends on November 26.

“The final price per share offered will be determined after the completion of the book-building process, followed by the individual subscriber subscription process,” Tadawul said in the scholarship application.

The company, which received approval for the IPO from the Saudi Arabian Capital Markets Authority on Nov. 4, did not give a date for the listing of its shares.

Saudi Tadawul Group’s shares will be listed on the Saudi Exchange’s main index once the listing and listing formalities are completed, the company said earlier this month. Citigroup, JP Morgan Chase and SNB Capital are financial advisors and global coordinators for the IPO.

The kingdom’s sovereign wealth fund, the Public Investment Fund, which is the sole owner of the company, is selling the shares that will be offered to both private and institutional investors.

On Nov. 9, the holding company increased the size of its offering to retail investors to 30 percent, up from 10 percent initially, as it seeks to increase the participation of individual investors.

“Our goal is to provide ample opportunities for all types of investors in the Saudi stock market to participate in the offering,” said Khalid Al Hussan, CEO of the Saudi Tadawul Group.

“Demand from individual investors has been strong, as seen during recent IPOs in Saudi Arabia, and we wanted to use this momentum to encourage diversity in our shareholder structure post-IPO,” he said at the time.

Tadawul, which ranks in the top 10 global equity markets with a market cap of approximately $2.8 trillion, will only become the third publicly traded regional stock exchange, after the Dubai Financial Market and Boursa Kuwait, once listed.

Tadawul Group has four subsidiaries, including the Saudi Exchange, a special branch that manages the kingdom’s stock market, formerly known as the Saudi Stock Exchange Company; the Securities Clearing Center Company (known as Muqassa); the Securities Depository Center Company (EDAA); and a new subsidiary focused on applied technology services known as Wamid.

Tadawul’s benchmark stock index is up about 35 percent since the start of the year, driven by new listings and improved investor sentiment due to higher oil prices.

Energy company Acwa Power listed its shares on the Saudi Exchange last month after it raised $1.2 billion through its IPO. It was the largest IPO in the kingdom since state oil company Saudi Aramco went public in 2019.

The Saudi exchange is also home to the largest petrochemical producer in the Middle East, Sabic, and Saudi National Bank, the largest commercial lender in the kingdom, among others.

Updated: November 21, 2021, 8:35 AM