Saudi retail investors will start today, Feb. 26, subscribing to around 5.25 million shares of Dr. Sulaiman Al Habib Medical Group (HMG) shares at SAR 50 each, after completing the book-building process.
The retail offering will run through Tuesday, March 3.
Institutional investors have recently subscribed to 52.5 million shares, or 100% of offered shares.
Read: Sulaiman Al Habib Group prices IPO at SAR 50 per share
The Capital Market Authority (CMA) approved in September 2019 the medical group’s request to float 52.5 million shares, or 15% of capital. A total of 90% of the offering size was allocated for institutional investors.
Sulaiman Al Habib’s IPO is the first share sale on Tadawul this year, and also the first in the healthcare sector since March 2016, when Middle East Healthcare Co., the operator of Saudi German Hospital chain, launched its IPO.
Last year, the Saudi market saw 5 IPOs by Saudi Aramco, Maharah Human Resources Co., Arabian Centres Co., Ataa Educational Co., and Al-Moammar Information Systems Co. (MIS).
Key Information:
The private medical group was established in 1993 as a sole proprietorship with SAR 100,000 capital in Riyadh. In 2007, it was converted into a limited liability company, ahead of converting into a closed joint stock company in 2013.
The company hiked its capital 4 times since inception. The first was in 2007 to SAR 500,000. Capital was again raised in 2013 to SAR 2 million, then to SAR 2.8 billion in early 2015 and in August 2015 to the current capital of SAR 3.5 billion, divided into 350 million ordinary shares at SAR 10 par value.
The group secured Islamic bank facilities, approved by Sharia committees in those banks.
Activities:
The group’s principal activities are the establishment and management of health and pharmaceutical facilities as well as HMG solutions, which includes home healthcare, medical laboratories, information technology and maintenance of facilities.
HMG also operates University Medical Center-King Abdullah Medical City Bahrain, along with intensive care units in 6 Ministry of Health facilities in 5 cities across the Kingdom.
In the pharmaceutical business, the group operates and manages Middle East Pharmacies Company (MEP) and Afia Pharmacies Co.
In Dubai, HMG operates its pharmaceutical business under the Pharmachoice brand.
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Dr. Sulaiman al Habib Group’s Activities |
|
|
Existing Healthcare establishments |
7 healthcare establishments including Olaya Medical Complex and Dubai Hospital as well as Al Qassim, Al Swaidi, Al Khobar, West Al Takhassosi and Al Rayan Hospitals. |
|
Healthcare establishments under construction |
3 hospitals in Northern Riyadh, South Western Jeddah and Northern Jeddah |
|
Managed healthcare establishments |
The University Medical Center of King Abdullah Medical City in Bahrain and the care departments in 6 facilities of the Ministry of Health in five cities |
|
Pharmaceutical establishments |
Middle East Pharmacies, Al Afia Pharmaceutical & Medical Equipment Co. and Pharma Choice Pharmacies in Dubai |
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Solutions segment |
Providing other health services and support services through operating and managing Medical diagnostic laboratories (MD LAB) and Home Healthcare in addition to providing utilities maintenance services through its affiliate SIRCO Services. Providing IT services though its affiliate Cloud Solutions Which provides modern technology systems to serve the auditors, improve the patient experience, and increase operational efficiency. |
The total number of the group’s beds stood at 1,913 by the end of 2019, without factoring the planned expansion that will add 1,180 beds.
This move will bring up the total number of beds to over 3,000 in the coming years.
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Al Habib Healthcare Facilities |
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|
Healthcare facility |
Land area (‘000 m²) |
Building Area (‘000 m²) |
Property ownership |
No. of clinics |
No. of employees |
No. of beds |
|
Olaya Medical Complex |
9.71 |
69.10 |
Rented/owned* |
203 |
1,844 |
260 |
|
Al Qassim Hospital |
6.11 |
31.00 |
Land is rented from municipality |
85 |
926 |
172 |
|
Al Rayan Hospital |
32.08 |
144.29 |
owned |
235 |
2,075 |
349 |
|
Western Al Takhassosi Hospital |
21.21 |
74.95 |
owned |
179 |
1,821 |
218 |
|
Al Swaidi Hospital |
19.37 |
116.00 |
owned |
243 |
1,461 |
305 |
|
Al Khobar Hospital** |
30.56 |
211.32 |
owned |
307 |
23** |
458 |
|
Dubai Hospital |
8.61 |
42.92 |
owned |
119 |
977 |
151 |
|
Total |
127.66 |
689.58 |
-- |
1,371 |
9,127 |
1,913 |
*the complex consists of 7 buildings of which 5 are owned and 2 are rented.
** Al Khobar Hospital started operations in Q2 2019. The company is currently hiring and relocating healthcare practitioners and employees.
Future Projects:
The group plans to set up the following 3 new health facilities in the Kingdom:
(1) North Riyadh Hospital;
(2) South West Jeddah Hospital; and
(3) North Jeddah Hospital.
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Company’s Profile |
|
|
Company |
Sulaiman Al Habib Medical Group Co. (HMG) |
|
Market |
TASI |
|
Main activities |
Managing and operating hospitals, specialized clinics, medical centers and one-day surgery centers in addition to some supporting activities |
|
Status |
Active |
|
Capital |
SAR 3.5 bln |
|
IPO Summary |
|
|
Issue percentage (%) |
15% |
|
Number of shares offered for ratail investors |
5.250 mln shares represent 10% of total offering shares |
|
IPO Price |
SAR 50/share |
|
Retail investors IPO size |
SAR 262.5 mln |
|
Qualified investors |
Saudi and GCC retail investors |
|
IPO minimum for retail investors |
10 shares |
|
IPO maximum for retail investors |
500,000 shares |
|
IPO period for retail investors |
7 days (from Wednesday, Feb. 26 until Tuesday, March 3, 2020) |
|
Allotment and surplus repayment |
March 9, 2020 |
|
Additional Information |
|
|
Financial advisor, underwriter |
Riyad Capital, Jadwa Investment |
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Institutions book runner |
Jadwa Investment- Riyad Capital- EFG Hermes Saudi Arabia |
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Lead manager |
Riyad Capital |
|
Receiving banks |
Riyad, NCB, Al Rajhi , SABB and Samba |
Sulaiman Abdulaziz Sulaiman Al-Habib is the top shareholder in the group. His stake after the IPO will reach 40.03%.
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Major Shareholders |
||
|
Shareholder |
Number of shares after IPO (mln shares) |
Stake % |
|
Sulaiman bin Abdulaziz S. Al Habib |
140.11 |
40.03 % |
|
Thabat Ltd.* |
12.85 |
3.67 % |
|
Mohammed bin Abdulaziz Al Habib & Sons Holding |
118.14 |
33.75 % |
|
Jawarat Al Bahr ** |
17.43 |
4.98 % |
|
Hisham Sulaiman bin Abdulaziz S. Al Habib |
7.00 |
2.00 % |
|
Mohamed Sulaiman bin Abdulaziz S. Al Habib |
1.98 |
0.57 % |
|
Public |
52.50 |
15.00 % |
|
Total |
350.00 |
100 % |
*Fully owned by Sulaiman Abdulaziz al Habib.
** Fully owned by Mohammed bin Abdulaziz Al Habib & Sons Holding
The following table illustrates the IPOs witnessed by the Saudi market in the last 5 years.
|
Recent IPOs |
|||
|
Company |
IPO price (SAR) |
Number of shares for retail investors (mln share) |
Coverage ratio % (retail) |
|
2019 |
|||
|
Aramco |
32 |
1,000 |
154 % |
|
Ataa |
29 |
1.20 |
426 % |
|
Maharah |
69 |
1.13 |
230 % |
|
Arabian Centres |
26 |
9.50 |
60 % |
|
Al Moammar |
45 |
0.71 |
149 % |
|
2018 |
|||
|
National Learning |
19 |
1.30 |
327 % |
|
Leejam |
52 |
1.57 |
245 % |
|
2017 |
|||
|
Al Waha |
51 |
0.9 |
263 % |
|
2016 |
|||
|
L’Azurde |
37 |
3.87 |
293 % |
|
Al Yamamah Steel |
36 |
4.57 |
479 % |
|
Saudi German Hospital |
64 |
8.28 |
274 % |
|
2015 |
|||
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Alandalus |
18 |
8.40 |
464 % |
|
SGS |
50 |
22.60 |
339 % |
|
SACO |
70 |
2.88 |
620 % |
|
MEPCO |
30 |
6.00 |
473 % |
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