Logo of Arabian Contracting Services Co. (Al Arabia)
Retail investors start, today, Oct. 26, subscription to 1.5 million shares of Arabian Contracting Services Co. (Al Arabia), at SAR 100 a share, determined by the book-building process.
On June 28, 2021, the Capital Market Authority (CMA) approved the company's request to offer 15 million shares, or 30%, of its SAR 50 million share capital in an initial public offering (IPO).
It allocated 90% of the total offered shares to institutional investors, while the remaining 10% were allocated to retail subscribers.
Retail subscription will last three days, ending Oct. 29, 2021.
This is the sixth IPO on the Saudi Exchange (Tadawul) in 2021, following Alkhorayef Water & Power Technologies Co., Theeb Rent a Car Co., Tanmiah Food Co., solutions, and International Company for Power and Water Projects (ACWA Power).
The Saudi market saw three IPOs in 2020, namely Dr. Sulaiman Al-Habib Medical Services Group in February, Amlak International for Real Estate Finance Co. in July, and BinDawood Holding in October.
Company Info:
Al Arabia was established in 1983 in Riyadh as a limited liability company, and it was converted into a closed joint stock company in 2006, with a current capital of SAR 500 million.
The company’s main business activity includes setting up, operating and maintaining outdoor advertising billboards and selling advertising spaces.
Recently, the company expanded its scope of business by entering the indoor advertising market, and concluded a number of exclusive contracts with owners of commercial centers in different regions within the Kingdom.
Company's Clients
The company's clients include media buyers, advertising agencies, and major companies that carry out their advertising campaign directly.
The following table shows the details of the company's revenues divided by different customer categories:
|
Revenue as per Client Type in 2020 |
||
|
Client Type |
Revenue (SAR mln) |
Percentage to Total |
|
Media Buyers |
334.4 |
67% |
|
Direct Advertisers |
110.6 |
22% |
|
Direct Government Clients |
26.9 |
6% |
|
Other |
25.7 |
5% |
|
Total |
497.6 |
100% |
|
Company Profile |
|
|
Company |
Arabian Contracting Services Co. |
|
Market |
The Saudi Exchange (Tadawul) |
|
Core Activities |
The business includes setting up, operating and maintaining outdoor advertising billboards, including road and indoor advertising. |
|
Capital |
SAR 500 mln |
|
IPO Summary |
|
|
Issue Percentage (%) |
30% |
|
Number of Shares Offered to Individual Investors |
1.5 mln, or 10% of the 15 mln total offered shares |
|
Issue Price |
SAR 100/share |
|
Qualified Subscribers |
Retail investors, comprising Saudi nationals, including Saudi female divorcees or widows with minor children from a non-Saudi father. It also includes any non-Saudi natural person who is a resident in the Kingdom and any GCC national, who holds a bank account with one of the receiving entities. |
|
IPO Minimum Limit for Retail Investors |
10 shares |
|
IPO Maximum Limit for Retail Investors |
300,000 shares |
|
Retail Offering Period (3 days) |
Oct. 26-28 |
|
Final Allocation of IPO Shares |
Nov. 4 |
|
Surplus Refund |
Nov. 4 |
|
Use of Proceeds |
The net proceeds, after deducting all the offering expenses amounting to SAR 35 million, will be distributed to selling shareholders, according to their ownership percentage in the offering. The company will not receive any part of the proceeds. |
|
Additional Information |
|
|
Financial Advisor, Lead Manager, Underwriter and Bookrunner |
GIB Capital |
|
Co-underwriter |
Albilad Capital |
|
Receiving Banks |
Riyad Bank, Saudi National Bank, Saudi British Bank, Bank Albilad |
Engineer Holding Group Co. will be the largest shareholder in the company after the IPO, with 65% stake.
|
Company Shareholders |
||||
|
Shareholders |
Before IPO |
After IPO |
||
|
Number of shares (mln) |
Ownership% |
Number of shares (mln) |
Ownership% |
|
|
Abdelellah Abdulrahman Al-Khereiji |
12.50 |
25.00% |
-- |
-- |
|
Engineer Holding Group Co. |
35.00 |
70.00% |
32.50 |
65.00% |
|
MBC Group Holding Co. |
2.50 |
5.00% |
2.50 |
5.00 % |
|
Public |
-- |
-- |
15.00 |
30.00% |
|
Total |
50.00 |
100% |
50.00 |
100% |
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