Riyadh: Saudi Arabia’s sovereign wealth fund is selling an additional 10 per cent stake in the kingdom’s stock exchange, pushing ahead with plans to reduce its holdings in some of the country’s biggest companies and raise funds for investments.
The Public Investment Fund is offering 12 million shares in Saudi Tadawul Group Holding, according to a statement. Based on the closing price of 209.60 riyals on Thursday, the deal could raise about 2.52 billion riyals ($669 million). The price will be determined through an accelerated book-building process, which started immediately and the results will be announced on Friday.
Investors put in orders for all the stock on offer less than an hour after the books opened, according to terms of the deal seen by Bloomberg News.
The sale comes almost a year after the stock exchange went public in a $1 billion initial public offering in which the PIF sold a 30 per cent stake. The shares have almost doubled since. Last year, the wealth fund also raised $3.2 billion from the sale of a stake in Saudi Telecom Co.
The PIF said in the statement that the Tadawul sale was in line with its strategy to “recycle its capital and invest in emerging and promising sectors in the local economy.”
The wealth fund is at the center of a plan by Riyadh to diversify Saudi Arabia’s economy, known as Vision 2030. It has plowed billions of dollars into stock markets and assets globally and owns stakes in domestic firms from Saudi Electricity and utility Acwa Power to Saudi National Bank.
The PIF, chaired by the Crown Prince Mohammed Bin Salman, also plans to invest $40 billion locally a year until 2025 and help bankroll ambitious projects, including Neom - a $500 billion city intended to attract new industries.
HSBC Holdings Plc and Morgan Stanley are joint global coordinators for the Tadawul sale. There is a 90-day lockup on the PIF following the placement.
