Oman plans to list 35 state-owned companies in the next five years

The country aims to take one or two oil companies public this year, senior official says

The Muscat Stock Exchange will launch a market maker and a liquidity fund either in March or April to support daily trading.

Oman seeks to list 35 state-owned companies over the next five years with initial public offerings planned for one or two oil companies this year, the chief executive of the Muscat Stock Exchange (MSX) told CNBC Arabia on Sunday.

The plan will be rolled out in the second half of this year, Haitham Al-Salmi said.

Foreign trading currently accounts for 14.5 per cent of total trading on the MSX. The banking sector accounts for 58 per cent of the MSX, which makes it “attractive” for foreign trade, he added.

Oman is emulating Saudi Arabia and the UAE, which have sold stakes in state-owned energy assets and other high performing entities in recent years as they seek to diversify their economies away from oil.

Saudi Arabian companies raised almost $9.3 billion from share offerings last year, making the kingdom one of the most active IPO markets in the Middle East and Africa, according to data compiled by Bloomberg.

Riyadh utility developer Acwa Power raised $1.2bn from its listing on the Tadawul in 2021, the largest since Aramco raised about $30bn in the world’s biggest-ever stock offering.

Abu Dhabi Securities Exchange, the Arab world's second-largest stock market, also recorded a surge in liquidity and foreign investment in 2021 on the back of new listings.

Nine companies listed on the main exchange last year, including Adnoc Drilling, which raised $1.1bn in October, as well as Fertiglobe, the world’s largest seaborne exporter of urea and ammonia combined, which reaped about $795 million.

Oman’s state-owned energy company OQ is considering local listings for some of its downstream and upstream assets but has no plan to float the parent company, a senior executive at the state-owned energy group told Reuters in November.

“We are working to fulfil all the requirements for listing the Muscat Stock Exchange in emerging market indices,” Mr Al-Salmi told CNBC Arabia.

The decision to raise the percentage of foreign investment in public companies is one of the most important steps on the road to including the MSX in global emerging market indices, he said.

Up to 98 per cent of companies in the market have no limits for foreign investment.

The MSX will launch a market maker and a liquidity fund either this month or in April to support daily trading and stabilise prices, Mr Al-Salmi said.

“We are currently working to increase the liquidity and market value of the Muscat Stock Exchange.”