Saudis set for biggest IPO since 2014 as retailer preps sale

RIYADH • Fawaz Alhokair Group, the Saudi retailer that owns the franchise for brands like Banana Republic and Zara, may raise as much as US$1 billion (RM4.14 billion) from the share sale of its malls unit in what would be the kingdom’s biggest initial public offering (IPO) in five years.

Arabian Centres Co Ltd said yesterday that it will sell 65 million existing shares and 30 million new shares, and will list the shares on the Tadawul stock exchange.

The proceeds of the offering could “be in the range of US$1 billion” and might start around April 28, CEO Olivier Nougarou said on a conference call. The company will use the money to reduce debt.

Saudi Arabia’s share sales have slowed as the kingdom’s economy grappled with lower oil prices. Listings by companies and real estate investment trusts raised close to US$900 million last year, down from US$6.7 billion in 2014, according to data compiled by Bloomberg.

Samba Capital and Investment Management Co, Morgan Stanley, NCB Capital Co and Goldman Sachs Group Inc, Citigroup Inc, Credit Suisse Group AG, EFG-Hermes Holding SAE, Emirates NBD Capital KSA and Natixis SA are managing Arabian Centres’ offering.

Also from Arabian Centres’ statement:

• The company operates 19 shopping malls spanning approximately 1.1 million sq m in gross leasable area.

• It plans to add an over 300,000 sq m gross leasable area in the next 12 months and a further 355,000 sq m in the medium term.

• Adding four new malls and one extension in the next 12 months.

• Revenue US$576 million in the fiscal year 2018. — Bloomberg