Saudi market regulator in talks with Aramco on IPO rules

Saudi Arabia’s Capital Market Authority (CMA) is in talks with Saudi Aramco and its advisers about the regulatory requirements for listing on the domestic stock exchange. (AFP/File Photo)
Updated 18 September 2019

Saudi market regulator in talks with Aramco on IPO rules

  • Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating
  • Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh

RIYADH: Saudi Arabia’s Capital Market Authority (CMA) is in talks with Saudi Aramco and its advisers about the regulatory requirements for listing on the domestic stock exchange, its chairman Mohammed bin Abdullah Elkuwaiz told Reuters.
“We continue to have discussions with the company and its advisers on both their readiness, as well as our regulatory requirements for the market,” Kuwaiz said on Wednesday.
Asked whether there will be any waivers or exemptions for the company’s listing, Kuwaiz told Reuters in an interview that the CMA is “still having those discussions.”
The Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating.
Aramco, whose chairman Yassir Al-Rumayyan said this week that the IPO would be ready within the next year and preparations were continuing despite Saturday’s attacks on its facilities, is yet to file its prospectus with the Saudi regulator.
“We receive waivers or exemption requests where needed and we review them on a case by case basis,” Kuwaiz said, in reference to those discussions.
Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh, but the government is still considering a secondary listing overseas, Saudi finance minister, Mohammed Al-Jadaan told Reuters in an interview on Wednesday.


Sharjah sells $1bn sukuk

Updated 03 June 2020

Sharjah sells $1bn sukuk

  • Gulf states seek to bolster finances hit by pandemic and historic slide in oil prices

DUBAI: Sharjah, the third-largest emirate of the UAE, sold $1 billion in seven-year sukuk, or Islamic bonds, on Tuesday, according to a document from one of the banks arranging the deal.

The debt sale comes as several governments in the Gulf seek to bolster their finances to face the economic fallout from the coronavirus pandemic and a historic slide in oil prices.

Sharjah set the final spread at 245 basis points (bps) over midswaps for the sukuk, which are Islamic sharia-compliant bonds, according to the document seen by Reuters.

It tightened the spread by 30 bps from where it began marketing the notes earlier on Tuesday.

Sharjah, rated Baa2 by Moody’s ratings agency and BBB by S&P, is a relatively frequent issuer of US dollar Islamic bonds.

HSBC was hired as global coordinator for the transaction. Other banks on the deal were Bank ABC, Dubai Islamic Bank, Gulf International Bank, Mashreqbank and Sharjah Islamic Bank.

In May, the emirate raised 2 billion dirhams ($545 million) in privately placed one-year sukuk to support its economy during the coronavirus pandemic, according to a statement by Bank of Sharjah, which arranged that deal.

“Issued as 12 month dirham-denominated paper in several tranches, the Sharjah Liquidity Support Mechanism (SLSM) sukuk represents the first rated short term local currency tradeable instrument in the UAE, which can be used for liquidity management by banks,” the Sharjah Finance Department said in a statement on Tuesday, confirming that deal. It said that it was a first tranche and that further tranches with one or more other banks were expected to expand the SLSM to 4 billion dirhams.

S&P Global Ratings in April revised its outlook on the emirate to negative from stable due to lower oil prices and the impact of the new coronavirus.

“Although we expect GDP growth to recover in 2021, lower-for-longer oil prices and a protracted lockdown period could pressure the emirate’s fiscal position,” the agency said.