PIF-owned Elm, four other Saudi firms set to go public

 PIF-owned Elm, four other Saudi firms set to go public

The Saudi Capital Markets Authority (CMA) has allowed five companies to list their shares on the bourses, as more and more local companies tap public markets to raise funds.

Three of the five companies will list on the main Tadawul exchange while the other two will list on the parallel market Nomu, the stock market regulator said.

The approvals come at a time when the Saudi capital market has seen a listing boom of sorts in recent years. A number of companies have already gone public this year, with Tadawul itself floating an initial public offering that was oversubscribed 121 times after institutional investors bid for shares worth $122 billion.

Other companies that have floated initial public offerings include food and agriculture products company Tanmiah Food, Riyadh-based Nayifat Finance Company, electricity utility ACWA Power and food ordering platform Jahez.

The new companies that will float their IPOs on the main stock exchange are Elm Company, Al Masane Al Kobra Mining Company, and Al Dawaa Medical Services Company.

All three companies will sell a 30% stake each but it is unclear how much money each of these companies plan to raise via the IPOs.

Elm, a digital solutions company promoted by the country’s sovereign wealth fund Public Investment Fund (PIF), will offload 24 million shares to the public.

Al Masane, a mining company that exports zinc and copper, will offload 19.8 million shares. Al Dawaa Medical, a pharmacy retail chain will divest 25.5 million shares.

The two companies that have been allowed to list on the country’s parallel market Nomu are AME Company for Medical Supplies and Raoom Trading Co. While AME has opted for a direct listing, Raoom will offload 1 million shares, making up a fifth of its total share capital, via a private placement.

In November, the CMA’s chief Mohammad El-Kuwaiz had said that as many as 54 applications for listing had been pending. Of these, 31 applications were for direct listing.

The Saudi capital market is now bigger than the country’s economy, even after excluding the market value of state-owned oil and gas behemoth Saudi Aramco. If Aramco’s market capitalisation is taken into account, Tadawul’s size is four times that of the country’s economy.

Aman Malik

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