Saudi Arabia’s stock exchange is due to make its trading debut next month after starting the process to sell a 30% stake in an initial public offering, according to its chief executive officer.
“We target to list the company in the first week of December,” Khalid Al Hussan said in an interview on Sunday. “The IPO is a continuation of our transformation,” he said, adding that the offering should give it a “better exposure and access to investors.”
The kingdom’s markets regulator last week signed off on Saudi Tadawul Group Holding’s offering of 36 million shares. SNB Capital, JPMorgan Chase & Co. and Citigroup are the IPO’s global coordinators and underwriters.
The offering, which may be one of the biggest in the exchange sector since Euronext NV’s $1.2 billion listing in 2014, could value the bourse at between $3 billion and $4 billion, people familiar with the matter said last month.
The exchange will offer all shares to institutional investors, with a clawback to retail investors of up to 10% of shares. Al Hussan said IPO subscription for institutions will start on 21 November and for individuals on 30 November.
Separately, Al Hussan said the exchange’s clearinghouse was on course to be fully operational in early 2022.
“We are also anticipating by the first half of next year the full activation of our clearing house, which should increase the revenue aspects of introducing clearing services to the market,” he added.
Tadawul will distribute 70% of earnings as a dividend, unless it’s working on growth projects and wants to keep the cash to help fund those, he added.
The CEO also said:
- All of the IPO proceeds will be collected by the Public Investment Fund, its sole shareholder
- Sees “exceptional number” of listings in the next 12 to 18 months
- Working with Gulf companies in Abu Dhabi, Kuwait and Bahrain for cross listing; sees first cross listing next year
- 9-month revenue at 900 million riyals ($240 million)
- 9-month profit at 477 million riyals vs 346 million year ago.