PHOTO
* Pitches for IPO advisor role due end-March - sources
* Likely 1-2 banks to be chosen
* Tadawul to list in 2018
(Adds details, context)
By David French and Hadeel Al Sayegh
DUBAI, March 23 (Reuters) - The Saudi Stock Exchange has asked banks to pitch for roles advising on its own initial public share offer, sources familiar with the matter said on Wednesday.
Saudi Arabia is expected to privatise and float a number of state-owned assets in the coming years as it seeks to raise cash to help bridge the the budget shortfall caused by lower oil prices, as well as to improve the efficiency of the economy by reforming state companies and bringing in professional investors.
The stock exchange, Tadawul, said in December that it planned to list its shares in 2018, but there has also been talk of privatisations, including IPOs, involving national oil firm Saudi Aramco, as well as the kingdom's ports, flour mills and utilities.
An invitation was sent out by Tadawul to local and international banks at the start of March asking them to submit bids to advise on the IPO, with responses due at the end of the month, two of the sources said.
No one was immediately available for comment at Tadawul, by far the largest exchange in the Middle East with a total market capitalisation of 1.48 trillion riyals ($395 billion), according to Thomson Reuters data.
Traditionally Saudi companies will choose one or two banks as IPO advisors. For example, the 22 billion-riyal listing of National Commercial Bank
1180.SE
in late-2014 was managed by HSBC's Saudi Arabian arm and the investment banking arm of Gulf International Bank
No size of stake to be sold or valuation was given in the invite, according to the sources, although one, a Gulf-based banker, said the valuation would be contingent on trading volumes.
On Wednesday, the Tadawul traded 279.2 million shares worth 4.75 billion riyals. In comparison the Dubai Financial Market
Tadawul's trading volumes, its main source of revenue, are expected to increase in the coming years following the opening up of the bourse to foreign investors last June.
The Saudi market's inclusion in international share indexes such as the MSCI
Tadawul made a net profit in 2014 of 265 million riyals on revenue of 487 million riyals, according to its latest available accounts. ($1 = 3.6724 UAE dirham)
($1 = 3.7501 riyals)
(Additional Reporting by Marwa Rashad in Riyadh; Editing by Alexander Smith) ((davidj.french@thomsonreuters.com; +971 4 362 5864; Reuters Messaging: davidj.french.thomsonreuters.com@reuters.net))
Keywords: SAUDI IPO/TADAWUL
* Likely 1-2 banks to be chosen
* Tadawul to list in 2018
(Adds details, context)
By David French and Hadeel Al Sayegh
DUBAI, March 23 (Reuters) - The Saudi Stock Exchange has asked banks to pitch for roles advising on its own initial public share offer, sources familiar with the matter said on Wednesday.
Saudi Arabia is expected to privatise and float a number of state-owned assets in the coming years as it seeks to raise cash to help bridge the the budget shortfall caused by lower oil prices, as well as to improve the efficiency of the economy by reforming state companies and bringing in professional investors.
The stock exchange, Tadawul, said in December that it planned to list its shares in 2018, but there has also been talk of privatisations, including IPOs, involving national oil firm Saudi Aramco, as well as the kingdom's ports, flour mills and utilities.
An invitation was sent out by Tadawul to local and international banks at the start of March asking them to submit bids to advise on the IPO, with responses due at the end of the month, two of the sources said.
No one was immediately available for comment at Tadawul, by far the largest exchange in the Middle East with a total market capitalisation of 1.48 trillion riyals ($395 billion), according to Thomson Reuters data.
Traditionally Saudi companies will choose one or two banks as IPO advisors. For example, the 22 billion-riyal listing of National Commercial Bank
No size of stake to be sold or valuation was given in the invite, according to the sources, although one, a Gulf-based banker, said the valuation would be contingent on trading volumes.
On Wednesday, the Tadawul traded 279.2 million shares worth 4.75 billion riyals. In comparison the Dubai Financial Market
Tadawul's trading volumes, its main source of revenue, are expected to increase in the coming years following the opening up of the bourse to foreign investors last June.
The Saudi market's inclusion in international share indexes such as the MSCI
Tadawul made a net profit in 2014 of 265 million riyals on revenue of 487 million riyals, according to its latest available accounts. ($1 = 3.6724 UAE dirham)
($1 = 3.7501 riyals)
(Additional Reporting by Marwa Rashad in Riyadh; Editing by Alexander Smith) ((davidj.french@thomsonreuters.com; +971 4 362 5864; Reuters Messaging: davidj.french.thomsonreuters.com@reuters.net))
Keywords: SAUDI IPO/TADAWUL
