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Saudi Arabia’s Al Majed for Oud seeks to raise $188m from IPO

Al Majed for Oud is offering 7,500,000 shares to investors – equivalent to 30 per cent of the company’s paid-up capital – at a price range of SAR90 to SAR94

by Kudakwashe Muzoriwa

August 26, 2024

Al Majed for Oud seeks to raise $188m from IPO

Image credit: Havelock One/ Website

Saudi Arabia’s Al Majed for Oud Company has started taking investor orders for its initial public offering (IPO), as one of the leading companies in the kingdom’s fragrance market seeks to raise as much as $188m (SAR705m) capitalising on the robust appetite for listings in the GCC region.

Al Majed for Oud is offering 7,500,000 shares to investors – equivalent to 30 per cent of the company’s paid-up capital – at a price range of SAR90 to SAR94.

The family-owned business said the offering price will be determined at the end of a book-building process. It is offering the shares in two tranches — institutional investors and retail investors— between August 25 and September 19.

Al Majed for Oud said the offering proceeds shall be distributed to the selling shareholders after the deduction of the offering expenses. It has hired Saudi Fransi Capital as its sole financial adviser, joint book-runner, and lead manager.

Founded by Sheikh Ali bin Othman Al Majed in 1956, Al Majed for Oud has 286 stores and offers more than 650 products across 132 brands as of December 31, 2023.

The perfume retailer plans to expand its presence in the kingdom and the GCC while enhancing its retail and digital platforms to keep pace with industry developments.

The MENA region’s listing activity remained resilient in Q2 2024, with 14 IPOs raising $2.64bn in proceeds, according to EY. Saudi Arabia led the listing activity with 11 public offerings, five of which were on the Tadawul.

Arabian Oud, another Saudi maker of the perfume, is also considering listing on the Saudi Exchange. The company hired Emirates NBD Capital and SNB Capital earlier this year for a potential share sale, according to a Bloomberg report.

Meanwhile, in other consumer markets, Saudi flour milling company Arabian Mills for Food Products Company said it plans to offer 15.4 million shares to investors – equivalent to 30 per cent of the milling firm’s paid-up capital – last week. The milling company has not yet provided a price range.