Arab Drilling Company, the leading oil and gas drilling contractor in Saudi Arabia, has set the final offer price of its IPO at 100 riyals ($26.6) a share, implying a market capitalisation of SR8.9 billion ($2.4 billion) at listing.
The company along with Goldman Sachs Saudi Arabia, HSBC Saudi Arabia and SNB Capital Company, as joint financial advisors, has announced the successful completion of the participating parties’ book-building process in compliance with the guidelines of the Capital Market Authority (CMA).
The book-building process generated an order book of SR162 billion ($43 billion) and resulted in a subscription of coverage of around 61x of the total offered shares.
Pan GCC expansion
Ghassan Mirdad, Chief Executive Officer of Arabian Drilling, said: “Global investors have come to recognise the significant and integral role we play – and will continue to play – in the oil and gas value chain in the kingdom. We specialise in both onshore and offshore drilling with a fleet size of 45 rigs serving four key clients and operating principally in KSA. The demand for our services remains high, especially given the elevated commodity price environment and concerns around energy security as a result of the current macro-political and economic landscape.
“Looking ahead, we also have plans to grow and expand further into the GCC, where we are also witnessing strong demand increases. The investment case is robust, and the demand for our shares has ensured a successful institutional fundraising phase. We now look forward to onboarding the retail investors, who make up a core and important element of our offering and shareholdings.”
Offer details
The total size of the offering is SR2,670,000,000 ($712,000,000). The offering consists of 26,700,000 offer shares (as defined below) comprising: (i) a secondary offering of 19.89% of the company's total share capital through the sale of 17,700,000 existing shares by the current shareholders of Arabian Drilling (The Industrialisation & Energy Services Company (TAQA) and Services Pétroliers Schlumberger S.A.); and (ii) a primary offering of 10.11% through the issuance of 9,000,000 new shares (offer shares). 100% of the offer shares have been provisionally allocated to the participating parties having participated in the book-building (participating entities). This may be reduced to 24,030,000 offer shares (representing 90% of the total Offer Shares) depending on the level of demand by Individual Investors (as defined below). The final number of offer shares allocated to the participating entities will be clawed-back accordingly based on subscriptions from Individual Investors.
Individual investors
Saudi Arabian nationals, foreign residents in the kingdom and GCC nationals (individual Investors) will be able to subscribe for shares in the retail offering between October 18 and 19 at the final offer price of SR100 per Offer Share through the appointed receiving agents which are The Saudi National Bank, Al-Rajhi Bank and Riyad Bank (receiving agents).
Trading of the offer shares on the Exchange is expected to commence after all relevant legal requirements and procedures have been fulfilled. Trading will be announced in local newspapers and on the Saudi Exchange website (www.saudiexchange.com). -- TradeArabia News Service
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