10 Saudi firms planning IPOs in 2018

A number of companies in Saudi Arabia have started work on their plans for an initial public offering (IPO) as oil prices edge higher, triggering hopes that subsequent improvement in liquidity will also channel into the domestic equity markets, research firm U-Capital said in a recent report.

“We believe early 2018 would be an opportune time for the companies to go public as oil prices would continue to remain higher supported by output cuts,” the Oman-based firm said.

In the wider Gulf region, Saudi Arabia and the United Arab Emirates (UAE) are expected to be the biggest contributors with regard to IPOs, with Saudi Aramco’s mega-listing expected towards the end of this year. Among the major upcoming offerings in the Kingdom are:

On Tadawul

1) Saudi Aramco: Saudi Arabia has already confirmed that at least a part of the 5 percent planned offering in the oil giant will be listed on the Saudi Stock Exchange. Cross-listing on international exchanges is also on the cards. Planned for second half of 2018, the $100 billion IPO is expected to be the largest in the world.

2) Flynas: The airline has selected a global firm to work on its IPO, which will make the Saudi carrier the largest budget airline in the Gulf Cooperation Council to list. Flynas has a fleet size of 80, compared to Dubai-listed Air Arabia’s 49, the report said.

3) Saudia units: Saudi Arabian Airlines (Saudia) last year said it could list 30 percent shares of its cargo business in 2018 as part of the company’s privatization plan. There have also been talks of listing a few other units of the firm.

4) Dar Al-Arkan Properties Co: The property management and leasing business of Tadawul-listed Dar Al-Arkan is expected to a float 30 percent stake in the next quarter. Dar Al-Arkan Properties has income producing assets worth SAR 2.7 billion spread across the Kingdom.

5) Bateel International: The IPO news was announced in 2016, and at the time Bateel owned 50 branches in the Middle East. This is expected to increase to 75 branches in 2018.

6) Al Saedan Real Estate Co: The firm announced its IPO plans in April 2017 and has since restructured its capital to reach SAR 1.3 billion. It has direct and indirect investments amounting to SAR 2 billion, the report said.

7) Saudi Flour Mills: The IPO of Saudi Arabia’s flour mill companies is expected to be announced during Q2 2018, after obtaining regulatory approvals.

8) ACWA Power: The Riyadh-based firm has invited banks to bid to arrange its initial public offer. The share listing is expected to be on Tadawul, in addition to another big foreign market.

On NOMU

9) National Building & Marketing Co: The company announced its plan for IPO in 2016 and has received an approval from Saudi Capital Market Authority (CMA). It is expected to offer 1.2 million shares, or a 20 percent stake.

10) Shebal Trading: Saudi CMA has approved the listing of a 20 percent stake, or 700,000 shares of Shebal Trading Co. on the Nomu parallel market.