Riyadh: Olam Group, one of Asia’s biggest agricultural commodity traders, will pursue a primary listing for its agribusiness unit in Singapore and a potential concurrent listing in Saudi Arabia as early as the first-half of 2023.
The proposed initial public offering of Olam Agri in Saudi Arabia would be the first listing of a global company in the country, Olam said in a statement. Saudi Arabia and the broader Gulf region are growing markets for the commodities that Olam Agri supplies, Group CEO Sunny Verghese said.
The plan follows the sale of a 35 per cent stake in Olam Agri to state-owned Saudi Agricultural & Livestock Investment Co., a subsidiary of the oil-rich country’s Public Investment Fund. The deal valued the business at about $3.5 billion.
Olam Agri sells grains and seeds and makes everything from edible oils to pasta. It is one of Olam Group’s main units, formed in a reorganization announced in early 2020. The group delayed a planned IPO in London last year for another unit, Olam Food Ingredients, citing the war in Ukraine.
The potential dual-listing in Singapore and Saudi Arabia would be the first of its kind, according to Verghese. It will allow Olam Agri to tap growing demand for rice, corn, barley and edible oils in the Gulf region, he said in an interview.
Another reason for wanting to list in Saudi Arabia is the deep pool of liquidity in the Middle East, Verghese said. Gulf IPOs have been on a tear. The Middle East saw about $23 billion raised through initial public offerings last year “- an amount that would have been a record were it not for Aramco’s $29 billion share sale in 2019, according to data compiled by Bloomberg.
Olam Group has picked banks to lead the planned Singapore listing of Olam Agri that could raise as much as $1 billion, Bloomberg reported last week.