Saudi Arabia’s market regulator approves Tadawul IPO

Owner of the kingdom’s bourse plans to sell 30 per cent of its share capital through the listing

Saudi Arabia's Capital Markets Authority (CMA) approved the initial public offering of Saudi Tadawul Group, the owner and operator of the kingdom’s stock exchange.

Tadawul plans to sell 36 million shares, representing 30 per cent of its share capital, through the listing, the regulator said in a statement on Wednesday.

Tadawul, which is among the top 10 global stock markets with a market capitalisation of about $2.8 trillion, will become only the third publicly traded regional stock exchange after the Dubai Financial Market and Boursa Kuwait once it is listed.

Earlier this year, Tadawul appointed NCB Capital, JP Morgan and Citigroup to advise on its IPO.

The kingdom's Public Investment Fund is the sole shareholder of Saudi Tadawul Group, which has four subsidiaries. These include: the Saudi Exchange, a dedicated arm running the kingdom's equity market previously known as the Saudi Stock Exchange Company; the Securities Clearing Centre Company (known as Muqassa); the Securities Depository Centre Company (Edaa); and a new subsidiary focused on applied technology services known as Wamid.

Tadawul has rallied more than 35 per cent since the start of the year on the back of IPOs, rising foreign investment and higher oil prices.

Energy company Acwa Power debuted on the Saudi exchange last month after it raised $1.2bn through its IPO. It was the kingdom's largest listing since Aramco went public in 2019.

A number of other companies, including Sabic, the Middle East’s largest petrochemicals company and Saudi National Bank, the country’s biggest lender by assets, also trade on the exchange.

The number of qualified foreign investors on Tadawul increased 18.6 per cent to more than 2,300 last year from 1,939 in January 2020.

Updated: November 4th 2021, 11:53 AM