Saudi: Fourth Milling’s IPO registers $27.25bln order book; final offer price unveiled
Fourth Milling Company has completed the institutional bookbuilding process, setting the final offer price for its initial public offering (IPO) on the Saudi Exchange (Tadawul) at SAR 5.30 per share.
The IPO implied a market cap of SAR 2.86 billion ($763.20 million) at listing after the price range was set between SAR 5 and SAR 5.30.
The institutional bookbuilding process generated an order book of around SAR 102.20 billion ($27.26 billion) and was 119 oversubscribed. Meanwhile, the total offering size hit SAR 858.6 million ($228.96 million)
Fourth Milling plans to list 162 million offer shares, representing 30% of the company’s total issued share capital.
Following the transaction, the current shareholder, Gulf Milling Industrial Company will own 70% of the Company’s share capital.
Khalid Al Maktary, CEO of Fourth Milling, said: “This exceptional demand, will pave the way for a successful IPO and deliver another step on MC4’s growth journey. Our commitment to quality, innovation and sustainable growth positions us for continued success.”
Riyad Capital has been appointed as the financial advisor, lead manager, bookrunner, and underwriter for the IPO. Riyad Bank and Arab National Bank (ANB) have been appointed as receiving agents.
Monday 30 September 2024
#SaudiArabia expects 2024 deficit to widen to 3% of GDP | Reuters
Saudi Arabia expects 2024 deficit to widen to 3% of GDP | Reuters
Saudi Arabia estimates its 2024 fiscal deficit will widen to almost 3% of GDP, according to a government statement on Monday, as it increases spending to boost growth and meet the objectives of its Vision 2030 economic transformation plan.
The kingdom expects to post a fiscal deficit of 118 billion riyals ($32 billion) this year, equal to 2.9% of GDP, a preliminary budget statement showed, wider than the 79 billion riyals projected in the 2024 budget statement in December.
Despite lower oil prices and voluntary oil production cuts, Saudi Arabia, the world's top oil exporter, has continued to increase spending. It expects to post a deficit of 2.3% of GDP in 2025.
"We have more revenues than what was expected...the spending is where the increase happened," said Naif al-Ghaith, Riyad Bank's chief economist.
Saudi Arabia is in the midst of a massive economic overhaul known as Vision 2030 aimed at ending its reliance on oil which requires hundreds of billions to develop new economic sectors and more sustainable revenue streams.
The Arab world's biggest economy needs oil prices at almost $100 barrel to balance its budget, the International Monetary Fund (IMF) estimates.
On Monday, the government forecast real GDP to return to growth of 0.8% this year from last year's contraction. GDP growth is projected to sharply accelerate to 4.6% in 2025, in part due to increased oil production.
Total revenue is expected to be 1.24 trillion riyals and government spending is estimated at 1.36 trillion riyals in 2024. In December, revenue this year was budgeted at 1.17 trillion riyals and spending at 1.25 trillion riyals.
The government projects revenues at 1.18 trillion riyals and expenditures at 1.29 trillion riyals in 2025, with spending likely to equate to about 30% of GDP over the next three years.
In Monday's statement, the government estimated growth in non-oil activities of 3.7% in 2024 from an average of almost 6% over the last three years.
Saudi Arabia estimates its 2024 fiscal deficit will widen to almost 3% of GDP, according to a government statement on Monday, as it increases spending to boost growth and meet the objectives of its Vision 2030 economic transformation plan.
The kingdom expects to post a fiscal deficit of 118 billion riyals ($32 billion) this year, equal to 2.9% of GDP, a preliminary budget statement showed, wider than the 79 billion riyals projected in the 2024 budget statement in December.
Despite lower oil prices and voluntary oil production cuts, Saudi Arabia, the world's top oil exporter, has continued to increase spending. It expects to post a deficit of 2.3% of GDP in 2025.
"We have more revenues than what was expected...the spending is where the increase happened," said Naif al-Ghaith, Riyad Bank's chief economist.
Saudi Arabia is in the midst of a massive economic overhaul known as Vision 2030 aimed at ending its reliance on oil which requires hundreds of billions to develop new economic sectors and more sustainable revenue streams.
The Arab world's biggest economy needs oil prices at almost $100 barrel to balance its budget, the International Monetary Fund (IMF) estimates.
On Monday, the government forecast real GDP to return to growth of 0.8% this year from last year's contraction. GDP growth is projected to sharply accelerate to 4.6% in 2025, in part due to increased oil production.
Total revenue is expected to be 1.24 trillion riyals and government spending is estimated at 1.36 trillion riyals in 2024. In December, revenue this year was budgeted at 1.17 trillion riyals and spending at 1.25 trillion riyals.
The government projects revenues at 1.18 trillion riyals and expenditures at 1.29 trillion riyals in 2025, with spending likely to equate to about 30% of GDP over the next three years.
In Monday's statement, the government estimated growth in non-oil activities of 3.7% in 2024 from an average of almost 6% over the last three years.
#UAE's Adnoc nears $13 billion deal to buy Germany's Covestro, WSJ reports | Reuters
UAE's Adnoc nears $13 billion deal to buy Germany's Covestro, WSJ reports | Reuters
United Arab Emirates's Abu Dhabi National Oil Co is likely to announce a $13 billion-plus deal for Germany's Covestro (1COV.DE), opens new tab as soon as this week unless an unexpected snag emerges, the Wall Street Journal reported on Monday, citing people familiar with the matter.
United Arab Emirates's Abu Dhabi National Oil Co is likely to announce a $13 billion-plus deal for Germany's Covestro (1COV.DE), opens new tab as soon as this week unless an unexpected snag emerges, the Wall Street Journal reported on Monday, citing people familiar with the matter.
Most Gulf markets end lower on rising tensions in the region | Reuters
Most Gulf markets end lower on rising tensions in the region | Reuters
Most stock markets in the Gulf ended lower on Monday as geopolitical tensions in the region simmered, with the Saudi index extending losses from the previous session when it snapped a 7-day winning streak
It has not ruled out a ground invasion and its troops have been training for it.
Saudi Arabia's benchmark index (.TASI), opens new tab dropped 0.4%, with aluminium products manufacturer Al Taiseer Group (4143.SE), opens new tab losing 0.3% and Al Rajhi Bank (1120.SE), opens new tab was down 1%.
The kingdom drew net inflows of 11.7 billion riyals ($3.12 billion) in foreign direct investment (FDI) in the second quarter, down 7.5% from a year earlier, government data showed on Monday.
Dubai's main share index (.DFMGI), opens new tab finished 0.4% lower, hit by a 2.2% slide in top lender Emirates NBD (ENBD.DU), opens new tab.
In Abu Dhabi, the index (.FTFADGI), opens new tab declined 0.5%.
The Qatari benchmark (.QSI), opens new tab gained 0.3%, helped by a 1.7% rise in Qatar Islamic Bank (QISB.QA), opens new tab.
Oil prices - a catalyst for the Gulf's financial markets - declined and were on track to fall for the third month in a row as a strong supply outlook and questions around demand outweighed fears that Israeli strikes in Lebanon and Yemen could escalate conflict in the Middle East.
Outside the Gulf, Egypt's blue-chip index (.EGX30), opens new tab gained 0.4%, with Talaat Mostafa Holding (TMGH.CA), opens new tab advancing 2.6%.
Hezbollah fighters are primed to confront any Israeli ground invasion of Lebanon, the group's deputy leader Naim Qassem said on Monday in his first public speech since Israeli airstrikes killed its veteran chief Hassan Nasrallah last week.
Israel says it will do whatever it takes to return its citizens to evacuated communities on its northern border safely.
Israel says it will do whatever it takes to return its citizens to evacuated communities on its northern border safely.
It has not ruled out a ground invasion and its troops have been training for it.
Saudi Arabia's benchmark index (.TASI), opens new tab dropped 0.4%, with aluminium products manufacturer Al Taiseer Group (4143.SE), opens new tab losing 0.3% and Al Rajhi Bank (1120.SE), opens new tab was down 1%.
The kingdom drew net inflows of 11.7 billion riyals ($3.12 billion) in foreign direct investment (FDI) in the second quarter, down 7.5% from a year earlier, government data showed on Monday.
Dubai's main share index (.DFMGI), opens new tab finished 0.4% lower, hit by a 2.2% slide in top lender Emirates NBD (ENBD.DU), opens new tab.
In Abu Dhabi, the index (.FTFADGI), opens new tab declined 0.5%.
The Qatari benchmark (.QSI), opens new tab gained 0.3%, helped by a 1.7% rise in Qatar Islamic Bank (QISB.QA), opens new tab.
Oil prices - a catalyst for the Gulf's financial markets - declined and were on track to fall for the third month in a row as a strong supply outlook and questions around demand outweighed fears that Israeli strikes in Lebanon and Yemen could escalate conflict in the Middle East.
Outside the Gulf, Egypt's blue-chip index (.EGX30), opens new tab gained 0.4%, with Talaat Mostafa Holding (TMGH.CA), opens new tab advancing 2.6%.
#AbuDhabi's ADNH to list 40% stake of catering unit on local bourse | Reuters
Abu Dhabi's ADNH to list 40% stake of catering unit on local bourse | Reuters
Abu Dhabi National Hotels (ADNH) (ADNH.AD), opens new tab is selling a 40% stake in its catering business through an initial public offering on the local bourse, the business said on Monday, as it looks to tap into the region's economic growth.
ADNH Catering, which provides food, cleaning, support services and manpower supply, operates in the United Arab Emirates (UAE) with over 18,000 staff and via a joint venture in Saudi Arabia, where it employs almost 1,000 people.
The Gulf has seen a flurry of IPOs in recent years as governments in countries such as Saudi Arabia and the UAE try to diversify their economies with ambitious reform plans that include deepening capital markets to attract investment.
Abu Dhabi, which generates most of the Gulf state's oil wealth, has attracted a slew of financial firms in recent years and has been investing heavily in tourism, with a target of 39.3 million tourists by 2030 from nearly 24 million in 2023. It also plans to boost hotel room availability to 52,000 by 2030 from 34,000 last year.
"I think it's part of our long-term strategy... and clearly that tourism and travel aspect is high on the agenda," CEO Clive Cowley said when asked about Abu Dhabi's growth efforts to become a tourism and travel hub.
However, Cowley told Reuters the company was planning to also expand in other segments like healthcare and education, adding Saudi Arabia was a "very exciting market" and growth opportunity.
Roadshows with investors will take place next week, he said.
ADNH Catering said in a statement the offer price for the IPO will be determined through a book-building process running from Oct. 7 to 15, with a listing expected as early as next month.
All the 900 million shares on offer will be sold by parent company Abu Dhabi National Hotels, which owns hotels such as the Ritz Carlton and Park Hyatt in Abu Dhabi, as well as the JW Marriott and the Sofitel in Dubai's Marina and Jumeirah Beach, respectively.
Abu Dhabi National Hotels (ADNH) (ADNH.AD), opens new tab is selling a 40% stake in its catering business through an initial public offering on the local bourse, the business said on Monday, as it looks to tap into the region's economic growth.
ADNH Catering, which provides food, cleaning, support services and manpower supply, operates in the United Arab Emirates (UAE) with over 18,000 staff and via a joint venture in Saudi Arabia, where it employs almost 1,000 people.
The Gulf has seen a flurry of IPOs in recent years as governments in countries such as Saudi Arabia and the UAE try to diversify their economies with ambitious reform plans that include deepening capital markets to attract investment.
Abu Dhabi, which generates most of the Gulf state's oil wealth, has attracted a slew of financial firms in recent years and has been investing heavily in tourism, with a target of 39.3 million tourists by 2030 from nearly 24 million in 2023. It also plans to boost hotel room availability to 52,000 by 2030 from 34,000 last year.
"I think it's part of our long-term strategy... and clearly that tourism and travel aspect is high on the agenda," CEO Clive Cowley said when asked about Abu Dhabi's growth efforts to become a tourism and travel hub.
However, Cowley told Reuters the company was planning to also expand in other segments like healthcare and education, adding Saudi Arabia was a "very exciting market" and growth opportunity.
Roadshows with investors will take place next week, he said.
ADNH Catering said in a statement the offer price for the IPO will be determined through a book-building process running from Oct. 7 to 15, with a listing expected as early as next month.
All the 900 million shares on offer will be sold by parent company Abu Dhabi National Hotels, which owns hotels such as the Ritz Carlton and Park Hyatt in Abu Dhabi, as well as the JW Marriott and the Sofitel in Dubai's Marina and Jumeirah Beach, respectively.
Oil prices set to fall for third month despite Middle East conflict | Reuters
Oil prices set to fall for third month despite Middle East conflict | Reuters
Oil prices were steady on Monday and on track to fall for the third month in a row as a strong supply outlook and questions around demand outweighed fears that Israeli strikes in Lebanon and Yemen could escalate conflict in the Middle East.
Brent crude futures for November delivery, expiring on Monday, lost 10 cents to $71.88 a barrel as of 0933 GMT. The more active December contract rose 6 cents to $71.60. U.S. West Texas Intermediate (WTI) futures lost 10 cents to $68.08 a barrel.
Both benchmarks had earlier gained more than $1.
Brent was on track to lose almost 9% month-on-month, which would be its biggest decline since November 2022. WTI was set to decline more than 7% since the end of August.
On Monday prices had been supported by the possibility that Iran, a key producer and member of the Organization of the Petroleum Exporting Countries, may be directly drawn into a widening Middle East conflict.
Since last week Israel has escalated attacks, conducting strikes which have killed Hezbollah and Hamas leaders in Lebanon and hit Houthi targets in Yemen. The three groups are backed by Iran.
"We suspect that some oil market participants will look past this escalation given that there still has not been a major physical supply disruption and Iran has not demonstrated any appetite to enter this nearly year-long conflict," said Helima Croft of RBC Capital Markets.
Oil prices also had a muted response to Beijing's announcement last week of fiscal stimulus measures in the world's second-biggest economy and top oil importer.
Traders question whether the measures would be enough to boost China's weaker-than-expected demand so far this year.
Data on Monday was not encouraging for demand, showing China's manufacturing activity shrank for a fifth straight month and the services sector slowed sharply in September.
Oil prices were steady on Monday and on track to fall for the third month in a row as a strong supply outlook and questions around demand outweighed fears that Israeli strikes in Lebanon and Yemen could escalate conflict in the Middle East.
Brent crude futures for November delivery, expiring on Monday, lost 10 cents to $71.88 a barrel as of 0933 GMT. The more active December contract rose 6 cents to $71.60. U.S. West Texas Intermediate (WTI) futures lost 10 cents to $68.08 a barrel.
Both benchmarks had earlier gained more than $1.
Brent was on track to lose almost 9% month-on-month, which would be its biggest decline since November 2022. WTI was set to decline more than 7% since the end of August.
On Monday prices had been supported by the possibility that Iran, a key producer and member of the Organization of the Petroleum Exporting Countries, may be directly drawn into a widening Middle East conflict.
Since last week Israel has escalated attacks, conducting strikes which have killed Hezbollah and Hamas leaders in Lebanon and hit Houthi targets in Yemen. The three groups are backed by Iran.
"We suspect that some oil market participants will look past this escalation given that there still has not been a major physical supply disruption and Iran has not demonstrated any appetite to enter this nearly year-long conflict," said Helima Croft of RBC Capital Markets.
Oil prices also had a muted response to Beijing's announcement last week of fiscal stimulus measures in the world's second-biggest economy and top oil importer.
Traders question whether the measures would be enough to boost China's weaker-than-expected demand so far this year.
Data on Monday was not encouraging for demand, showing China's manufacturing activity shrank for a fifth straight month and the services sector slowed sharply in September.
#SaudiArabia FDI stalls at $5.2 bln in second quarter despite reform drive | Reuters
Saudi Arabian FDI stalls at $5.2 bln in second quarter despite reform drive | Reuters
Foreign direct investment (FDI) into Saudi Arabia stalled in the second quarter at around the same level as a year ago, government data showed on Monday, highlighting the kingdom's need for further reforms to meet its ambitious targets.
Saudi Arabia drew 19.44 billion riyals ($5.18 billion) in FDI, which was little changed from 19.43 billion riyals in Q2 last year, the General Authority of Statistics data showed. Overall, Saudi Arabia recorded net FDI inflows of 11.7 billion riyals in the second quarter, down 7.5% from a year earlier.
Foreign investment is a key element of Saudi Arabia's Vision 2030 plan, spearheaded by Crown Prince Mohammed bin Salman, to boost non-oil growth, expand the private sector and create jobs.
The kingdom has set a goal of attracting $100 billion in FDI by 2030. But halfway through Vision 2030, FDI numbers indicate that it could struggle to meet that target.
Although FDI volumes in Q2 rose 14.5% from the first quarter of 2024, total inflows in the first half were similar to the first six months of last year at 36.41 billion riyals, versus 36.35 billion riyals.
Saudi Arabia last year adopted a new methodology for calculating and publishing FDI data, which led to a significant upwards revision in total figures for 2022.
And the government has said it would update existing investment laws, opens new tab to boost transparency and promote equal treatment of local and foreign investors.
Despite speeding up government efforts, FDI inflows still lag regional peers such as the United Arab Emirates.
"Reforms to enhance Saudi Arabia's attractiveness for foreign investment are progressing," the International Monetary Fund said in a recent country report.
This recognised the record high number of foreign investment licenses and increasing licenses for firms to establish regional headquarters in the country.
"Enhancing private sector development will require providing more clarity to investors and removing remaining bottlenecks identified, including those in the regulatory and business environment," the IMF said.
Foreign direct investment (FDI) into Saudi Arabia stalled in the second quarter at around the same level as a year ago, government data showed on Monday, highlighting the kingdom's need for further reforms to meet its ambitious targets.
Saudi Arabia drew 19.44 billion riyals ($5.18 billion) in FDI, which was little changed from 19.43 billion riyals in Q2 last year, the General Authority of Statistics data showed. Overall, Saudi Arabia recorded net FDI inflows of 11.7 billion riyals in the second quarter, down 7.5% from a year earlier.
Foreign investment is a key element of Saudi Arabia's Vision 2030 plan, spearheaded by Crown Prince Mohammed bin Salman, to boost non-oil growth, expand the private sector and create jobs.
The kingdom has set a goal of attracting $100 billion in FDI by 2030. But halfway through Vision 2030, FDI numbers indicate that it could struggle to meet that target.
Although FDI volumes in Q2 rose 14.5% from the first quarter of 2024, total inflows in the first half were similar to the first six months of last year at 36.41 billion riyals, versus 36.35 billion riyals.
Saudi Arabia last year adopted a new methodology for calculating and publishing FDI data, which led to a significant upwards revision in total figures for 2022.
And the government has said it would update existing investment laws, opens new tab to boost transparency and promote equal treatment of local and foreign investors.
Despite speeding up government efforts, FDI inflows still lag regional peers such as the United Arab Emirates.
"Reforms to enhance Saudi Arabia's attractiveness for foreign investment are progressing," the International Monetary Fund said in a recent country report.
This recognised the record high number of foreign investment licenses and increasing licenses for firms to establish regional headquarters in the country.
"Enhancing private sector development will require providing more clarity to investors and removing remaining bottlenecks identified, including those in the regulatory and business environment," the IMF said.
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