SPIMACO: Qassim Medical’s Nomu listing plan ‘at early stage’

Abdulaziz Al-Oud, CFO of Saudi Pharmaceutical Industries and Medical Appliances Corp. (SPIMACO) said the procedures for listing Qassim Medical Services Co. on the Nomu-Parallel Market are still at a very early stage, noting that the first step was obtaining the company’s general assembly approval to proceed with the offering.

He told Argaam that SPIMACO owns more than 57% of Qassim Medical Services and is its major shareholder, while Qassim National Hospital in Buraidah represents the company’s main asset.

He added that the hospital has witnessed significant improvement over the past three years in terms of revenue, financial performance and utilization rates, noting that its current capacity is fully utilized.

Regarding the offering structure, Al-Oud said the listing mechanism and SPIMACO’s post-offering ownership stake remain under review in coordination with the financial adviser and in accordance with regulatory procedures.

“One possible scenario could involve increasing Qassim Medical Services’ capital and bringing in new investors, which could reduce SPIMACO’s ownership stake depending on the size of the capital increase,” said Al-Oud.

There is no predetermined target valuation for the offering, as the valuation will depend on the financial adviser’s report, comparisons with similar investments and hospitals in the market, as well as an assessment of EBITDA margins and prevailing market multiples, according to the official.

The CFO further stated that the next steps include completing the regulatory procedures with the Capital Market Authority and the financial adviser, followed by the final valuation and determination of the offering structure, whether through a direct share offering or a capital increase.

As regards the use of the offering proceeds, Al-Oud said no final decision has been made yet on whether the funds will be used to reduce debt, finance new pharmaceutical investments, or return part of the proceeds to shareholders.

He noted that the decision will depend on the company’s financial position and funding requirements when the proceeds are received.

It is currently too early to determine the financial impact of the offering on SPIMACO’s financial statements before the valuation studies are completed and the size of the stake to be offered is determined, he added.

As for the timeline, Al-Oud said no specific date can currently be set for the offering, noting that the timing will depend on the speed of completing the procedures and obtaining the required approvals, as well as market conditions at the time of the offering and the extent to which the indicative price aligns with the company’s expectations.

According to Argaam’s data, SPIMACO previously said shareholders of its subsidiary, Qassim Medical Services, approved the offering and listing of part of the company’s shares on Nomu.