Government commences Royal Jordanian IPO

Dubai: The Jordanian Government yesterday began an initial public offering (IPO) to sell up to 59,905,079 shares in Royal Jordanian Airlines.

These shares represent 71 per cent of the company's issued share capital at a price of 2.75 to 3.40 Jordanian dinars per share, a statement said.

Features

The IPO consists of an offering to the public and certain institutional investors resident in Jordan.

It also includes an offering to certain institutional investors outside Jordan and the United States in offshore transactions in accordance with Regulation S of the US Securities Act of 1933.

In addition it involves a placement of up to 6,749,868 shares for no consideration with Royal Jordanian's employee fund as part of an incentivisation scheme for the benefit of the company's employees.

Nasser Lozi, chairman of the Royal Jordanian Privatisation Group and Royal Jordanian, said: "The Government made a commitment in 2006 to proceed with the second phase of the privatisation of Royal Jordanian and, following in-depth planning and extensive preparation, today we are pleased to announce that we are ready to move forward on the privatisation with the offering of up to 71 per cent of the government's shares to the general public in Jordan and to Jordanian and international institutional investors.

"Royal Jordanian has undergone significant changes over the past three years and today is well placed for the future."

Excluding domestic services, the company is the leading airline in the Levant in terms of destinations and flight frequencies with a 68 per cent share of two-way traffic between Jordan and the Levant.

Strong position

It is in a strong position to take commercial advantage of the expected increase in traffic in the region.

Citigroup Global Markets is the sole global co-ordinator and bookrunner of the offer with Arab Jordan Investment Bank acting as Jordanian lead manager and Shuaa Capital as selling agent.