Riyadh, Asharq Al-Awsat- The 10-day IPO of Emaar the Economic City (EEC), which was over-subscribed since the third day of subscription, closed today with record number of subscribers applying for shares.
As at the end of the ninth day of subscription, over 2.5 million applications were received from over 9.2 million subscribers, with the amount subscribed already over SR6.7 billion. The final calculations of the number of applications, subscribers and funds collected will be announced soon.
“We thank the Saudi investors for their tremendous response to the IPO and the CMA and our banking partners for their support,” said Mr Mohamed Ali Alabbar, Chairman, EEC. “The overwhelming appreciation for EEC shares is a true indication of emerging investor appetite and trust in the King Abdullah Economic City project (KAEC), which will be financed through the net proceeds of the IPO. KAEC is a truly landmark development that will usher in a new era of prosperity for the Kingdom.”
“The highly encouraging response to the EEC IPO underscores the positive investment climate of the Kingdom and the importance of the KAEC project as a development that will bring in all-round growth,” said Mr Nidal Jamjoom, Chief Executive Officer, EEC. “We are thankful to the Capital Market Authority (CMA) of Saudi Arabia; to HSBC and Saudi British Bank (SABB), the exclusive financial advisor, lead manager and lead underwriter to the IPO; and to Riyad Bank and NCB, the sub-underwriters. We also thank the 11 receiving banks that have played an active role in reaching out to Saudi investors across the vast Kingdom using innovative means.”
EEC, a consortium headed by global real estate major Emaar Properties PJSC and a number of high profile investors from Saudi Arabia, had offered a total of 255 million shares at a nominal value of SR10 each. The fully underwritten IPO was open only for Saudi nationals. KPMG Al Fozan & Bannaga are the registered auditors and reporting accountants while Baker & McKenzie are the legal advisors of the IPO.
The SR100 billion (US$26.6 billion) King Abdullah Economic City is the largest private sector initiative in the Kingdom. Saudi Arabian General Investment Authority (SAGIA), the body responsible for inward investments to the Kingdom, is the prime facilitator of KAEC.
King Abdullah Economic City covers a greenfield site of 55 million sq m. The City will undertake mixed-use developments in six components: a modern world-class seaport, industrial district, financial island, educational and healthcare zone, resorts and the residential area. The overall project will be completed in stages, with the first batch of commercial houses and residents expected to take possession within 30 to 36 months.