Riyadh: Stock offerings in Saudi Arabia look set to pick up pace after slowing in the first half of the year, with two new deals for an oil driller backed by the kingdom’s sovereign wealth fund and an air cargo business being given regulatory approval.
Ades Holding, the oil and gas driller backed by the Public Investment Fund, and SAL Saudi Logistics, were both granted approval to sell 30 per cent stakes to the public, the kingdom’s Capital Market Authority said Wednesday. The Ades deal could raise about $1 billion, making it one of the largest Saudi offerings of the year.
Typically one of the biggest and busiest listings markets in the Gulf, Saudi Arabia has recently been more subdued after its stock market slumped last year. However, a 10 per cent rally in the Tadawul All Share Index since the start of the year coupled with a number of debuts this week have shown that investor appetite for offerings is still strong.
Several other large share sales are also in the works though without a clear timeline yet, including a potential secondary offering of Saudi Aramco and a listing of its trading business.
The Public Investment Fund teamed up with the major owners of Ades to take the business private in 2021, in a deal valuing the company at about $516 million. Ades, which provides oil-and-gas drilling and production services in the Middle East and North Africa, has since grown through acquisitions.
The company had initially targeted going public in the first half of the year but decided to hold off as it waited for a suitable market window, Bloomberg reported in May.
SAL, the air cargo handler spun out from national carrier Saudi Airlines, has been planning an IPO since at least 2021 and was working with HSBC Holdings as financial adviser at that time, Bloomberg reported.
The CMA, as the regulator is known, has also approved six new IPOs on the country’s small cap Nomu market over the past two days.